THE ECO-CONTRIBUTION
Parliament approved the enactment of the Eco-Contribution Act on the 27th July 2004 and was published in the Government Gazette on the 13th August 2004. The provisions of the Act are effective as from 1st September 2004. The designated Competent Authority to carry out the administration and regulatory functions of the Act is the Commissioner of VAT.
Products subject to the contribution
The eco-contribution, either as a rate per unit or per litre, is payable on items listed in the First Schedule to the Act, The list includes:
- Glass, plastic or metal containers
- Toiletries and washing preparations
- Tyres for motor vehicles (including commercial vehicles)
- Batteries
- Petroleum oils and oil filters
- Cooling and refrigeration equipment
- Water heaters
- Monitors and TV equipment
- Telecommunications equipment
- Appliances used for washing and cooking
Contribution payable to Competent Authority
Local manufacturers and importers, defined by the Act as producers, are to pay the applicable contribution. The contribution is payable in arrear on a quarterly basis by the submission of the appropriate declaration.
The contribution is due on products placed on the market during a period, generally a quarter. The first quarter starting from the 1st September 2004 ending 30th November 2004.
The Act defines placed on the market as follows:
…when a product is transferred from the manufacturing stage with the intention of distribution on the market in Malta, or when a product is brought into Malta with the intention of distribution on the market
Hence in the case of a manufacturer, the contribution is based on sales transactions, whilst in the case of importers; it is due on goods imported into Malta.
Exemption/Credit of Eco-Contribution
The Minister responsible for waste management in concurrence with the Minister of Finance may exempt any producer from the payment of the contribution or grant a credit against future eco-contribution dues if certain requirements are met.
Registration as a Producer
A producer, who was as such on 1st September 2004, must register under the said Act not later than 30th September 2004 on prescribed forms available from the VAT Department in Birkirkara.
In the case of a new producer, he is obliged to register within 30 days from the date he became a producer.
Recording the Eco-Contribution
The contribution is a cost to the producer, and therefore is not identified on a sales document.
The producer's mark-up is added to product costs and VAT is charged on the resulting selling price.
Reporting requirements
The Act and regulations impose a duty on the producer to maintain accurate accounts and stock records.
Penalties
Legal notice 395 of 2004, imposes the following administrative penalties:
- Understatement in a return
- 10% of the excess over the amount declared (reduced to 5% if the producer corrects such understatement)
- Incomplete or incorrect return
- Unless corrected, a penalty of Lm 100.
- Failure to submit return
- Lm 25 per month starting from the due date of the return
- Failure to register in time
- Lm 25 per month of delay
- Understatement in a return