EU Tax harmonisation not in Malta’s interests

Former Prime Minister and MEP Alfred Sant told the European Parliament that EU tax harmonisation goes against Malta’s interests and peripheral regions and islands with limited endowments within the European Union. Dr. Sant made this statement in an explanation of vote while the European Parliament was discussing the “Preparation of the Commission Work Programme 2016.” Dr. Sant said that the Commission Work Programme 2016 rightly defines as an important objective the elimination of rampant tax evasion and avoidance, as well as aggressive tax planning by multinational corporations. Measures that, in a transparent and consistent manner, seek to attain this goal in the context of a level playing field are desirable.
Dr. Sant said that a very serious problem arises when the measures contemplated to eliminate rampant tax evasion go beyond the stated objective and prepare the ground for tax harmonisation. ‘This goes against the interest of peripheral regions and islands within the Union. When adopting European regulations they have among others, removed protective trade barriers, adopted consumption taxes that follow continental models, phased out state aid, adopted stringent budgetary rules, abandoned exchange rate autonomy. This has severely curtailed their competitivity. The only element that remains for them to safeguard it is fair tax competition.’
Dr. Sant said that the resolution on the Commission Work Programme for 2016, endorses a mandatory common consolidated tax base. In current circumstances, these proposals amount to a first substantial step towards harmonisation. They are hugely detrimental to the development prospects of islands and regions at the periphery of the Union. ‘I cannot approve them.’ Dr Sant told the European Parliament.
The resolution was passed with 408 votes in favour, 182 against and 23 abstentions. Dr Sant voted in favour on the final vote of the resolution but he voted against the paragraph mentioning the setting up of a mandatory common consolidated tax base.

Maltese Version – ‘MA JAQBILX GĦAL MALTA LI T-TAXXI FL-UE JINĠABU KOLLHA FUQ L-ISTESS LIVELL’

Il-Kap tad-Delegazzjoni Laburista fil-Parlament Ewropew qal li l-armonizzazzjoni tat-taxxi fil-pajjiżi tal-Unjoni Ewropea taħdem kontra l-interessi ta’ Malta, ta’ stati gżejjer oħra u tar-reġjuni fil-periferija tal-Unjoni Ewropea. Dr. Alfred Sant qal dan waqt li l-Parlament Ewropew kien qed jiddiskuti rapport dwar il-ħtieġa ta’ sistema waħda kif il-kumpanniji jżommu l-kontijiet tagħhom. Din il-miżura kienet se sservi bħala l-ewwel pass biex it-taxxi fl-Unjoni Ewropea jinġabu kollha fuq l-istess livell. ‘Ma nistax naqbel ma’ din il-miżura għax dan ma jkunx fl-interess ta’ Malta u pajjiżi żgħar fil-periferija tal-Unjoni Ewropea.’ qal lill-Parlament Ewropew Dr. Sant.
Dr. Sant qal li l-programm tal-Kummissjoni Ewropea għas-sena 2016 għal ħlas tat-taxxa mill-kumpanniji multinazzjonali u l-ħidma kontra l-evażjoni u l-evitar tat-taxxa għandu għan tajjeb. Dawn huma miżuri pożittivi li, jekk isiru b’mod konsistenti u bi trasparenza, iwasslu biex f’dan ir-rigward l-ebda pajjiż ma jkun vantaġġjat.
Dr Sant qal li jinħolqu l-problemi meta l-miżuri maħsuba biex jaħdmu kontra l-evażjoni tat-taxxa, imorru lil hinn minn dan l-għan u joħolqu l-pedament għall-armonizzazzjoni tat-taxxa. Dan jaħdem kontra l-interessi ta’ stati gżejjer u ta’ reġjuni fil-periferija li għandhom riżorsi limitati. Meta dawn addottaw ir-regolamenti Ewropej, fost oħrajn dawn l-istati neħħew il-barrieri protettivi tal-kummerċ, addottaw taxxi tal-konsum li jimxu fuq mudelli kontinentali, neħħew l-għajnuna tal-istat, addottaw regoli iebsa fil-baġits tagħhom, abbandunaw rata awtonoma tal-kambju. Dan kollu naqqas mill-kompetittivita` tagħhom. L-uniku element li fadlilhom biex jikkompetu huwa permezz il-kompetizzjoni ġusta fit-taxxa.
Dr Sant qal li ir-riżoluzzjoni dwar il-Programm ta’ Xogħol tal-Kummissjoni għas-sena 2016, tapprova ‘consolidated tax base’ komuni u mandatorja. Fil-preżent, dawn il-proposti jagħmlu pass kbir fit-triq li twassal lejn l-armonizzazzjoni. Dawn huma ta’ detriment kbir għall-iżvilupp prospettiv tal-istati gżejjer u tar-reġjuni l-oħra fil-periferija tal-UE. ‘Ma nistax napprovahom.’ Qal Dr Sant.
Ir-riżoluzzjoni għaddiet b’408 voti favur, 182 kontra u 23 astenzjoni. Dr Sant ivvota favur il-vot finali tar-riżoluzzjoni imma vvota kontra l-paragrafu li jsemmi l-‘consolidated tax base’ komuni u mandatorja.