Tax collection should be prerogative of each EU member state

The European Commission’s proposal on Special VAT Exemption scheme for small enterprises should leave certain simplifications measures optional in case Member States would want to be more stringent in the way they collect their VAT, Maltese MEP Alfred Sant and Shadow Rapporteur for the S&D Group, told the European Parliament Committee on Economic and Monetary Affairs Committee (ECON) on the European Commission’s proposal for a Common system of value added tax as regards the special VAT scheme for small enterprises in the framework of the consideration of the amendments from all political groups. National systems vary in the share of SMEs in their economy and may rely more on VAT collected from them. This is especially relevant in the case of Malta, which derives more tax input from SMEs than other EU countries.
The proposal represents nevertheless an effort to further unblock the rigidities of the VAT with respect to SMEs. Dr Sant underlined that MEPs should each vote for the thresholds that suit the circumstances in their respective countries and that this Directive was not an ideological issue. It should especially ease cross-border traffic for SMEs willing to engage in EU trade.
To this end, Dr Sant expressed his support for the set up of an online registration system and for a one-stop-shop for filing VAT returns in different Member States which would be established by the Commission.
The Maltese MEP emphasised that the simplification measures should be no avenue for tax avoidance and VAT fraud.
“Making the VAT process simpler for SMEs should by no means allow for facilitating abuses or disappearance of tax money.” remarked the Maltese MEP.
Dr Sant said he was totally in favour of keeping the Commission’s threshold of €2 million annual turnover, trusting the Commission’s executive experience. He strongly objected to the Rapporteur’s amendment which would increase the threshold in the definition of SMEs up to €4 million euros turnover. Such increase could have great budgetary implications for Malta and could induce a loss of revenues for the national treasury.
“I suggest that one sticks to the Commission’s original proposal with only the maximum threshold set for exemption, while Member States would remain with the possibility to set the lower one.”
The Maltese MEP referred to an amendment he tabled regarding the transitional regime.
Dr Sant has put forward one of his amendments in favour of SMEs facing seasonal factors or irregular demand, extending the transitional regime foreseen in the Directive.
“When SMEs overrun the exemption thresholds of €85,000, they should be provided with a 2 year, rather a 1 year transition period, before losing their exempt status, always provided that the annual turnover in the Member State concerned during these two years, does not exceed the threshold by over 50%. This would allow SMEs in certain sectors, such as the construction sector, which are confronted with seasonal factors and irregular demand, to benefit from a greater smoothing period.”
Referring to the implementation dates, the Maltese MEP said that together with the S&D group, he is supporting their advancement, as such VAT simplification measures could be implemented more quickly than the definitive VAT regime.
The report will be voted on Wednesday 11 July in the ECON Committee and will be debated and voted later in September at the Plenary of the European Parliament.

Maltese Version – IL-ĠBIR TAT-TAXXI GĦANDU JIBQA’ PREROGATTIVA TAL-ISTATI INDIVIDWALI TAL-UE

Il-proposta tal-Kummissjoni Ewropea dwar l-iskema speċjali tal-eżenzjoni tal-VAT għal intrapriżi żgħar għandha tippermetti miżuri simplifikattivi f’każ li l-Istati Membri tal-UE jagħżlu metodi aktar stretti fil-ġbir tal-VAT, qal Alfred Sant, Shadow Rapporteur għal Grupp tal-S&D, lill-Kumitat tal-Parlament Ewropew dwar l-Affarijiet Ekonomiċi (ECON). Il-Kummissjoni Ewropea ipproponiet sistema komuni ta’ VAT fir-rigward ta’ skema speċjali ta’ VAT għall-intrapriżi ż-żgħar fil-qafas tal-kunsiderazzjonijiet tal-emendi mill-gruppi politiċi tal-Parlament Ewropew. Is-sehem tal-SMEs fl-ekonomiji tas-sistemi nazzjonali jvarja u xi pajjiżi jistgħu jiddependu aktar mill-VAT miġbura mill-SMEs minn pajjiżi oħra. Dan huwa rilevanti ħafna fil-każ ta’ Malta, li tirċievi l-akbar kontribut fiskali mill-SMEs, ħafna aktar minn pajjiżi oħra tal-UE.
Il-proposta tal-KE hija maħsuba biex jitneħħew ir-riġiditajiet tal-VAT fir-rigward tal-SMEs.
Dr Sant saħaq li l-MEPs għandhom jivvotaw għal limiti adattati għaċ-ċirkostanzi tal-pajjiżi tagħhom. Din id-direttiva m’hix kwistjoni ideoloġika. Għandha taġevola it-traffiku għal SMEs li huma lesti jidħlu fil-kummerċ tal-UE ma’ stati membri oħra.
Għal dan il-għan, Dr Sant esprima l-appoġġ tiegħu għat-twaqqif ta’ sistema ta’ reġistrazzjoni online u għal one-stop-shop għal filing tal-VAT returns fi Stati Membri differenti li se jkunu stabbiliti mill-Kummissjoni.
L-Ewroparlamentari enfasizza li l-miżuri ta’ simplifikazzjoni ma għandhomx ikunu triq għal evitar tat-taxxa u l-frodi fil-VAT.
“Li l-proċess tal-VAT isir aktar sempliċi għall-SMEs m’għandu bl-ebda mod jippermetti l-iffaċilitar ta’ abbużi jew għajbien tal-flus mit-taxxa.” irrimarka l-Kap tad-Delegazzjoni Laburista fil-Parlament Ewropew.
Dr Sant qal li kien totalment favur il-limitu propost mill-Kummissjoni ta’ €2 miljun fatturat kull sena, għax għandu fiduċja fl-esperjenza eżekuttiva tal-KE. Huwa oġġezzjona b’mod qawwi għall-emenda tar-Rapporteur li żżid il-limitu fid-definizzjoni tal-SMEs sa valur ta’ €4 miljun. Din iż-żieda jista’ jkollha implikazzjonijiet baġitarji kbar għal Malta u tista’ twassal għal telf ta’ dħul għat-teżor nazzjonali.

“Nissuġġerixxi li wieħed iżomm mal-proposta oriġinali tal-Kummissjoni bil-limitu massimu stabbilit għall-eżenzjoni biss, filwaqt li l-Istati Membri jibqgħu bil-possibbiltà li jistabbilixxu l-iktar waħda baxxa.”
L-Ewroparlamentari Malti irrefera għal emenda li ressaq fir-rigward tar-reġim transitorju.
“Meta l-SMEs jaqbżu l-limiti ta’ eżenzjoni ta’ €85,000, għandhom jingħataw perjodu ta’ tranżizzjoni ta’ sentejn, aktar milli ta’ sena, qabel ma jitilfu l-istatus ta’ eżenzjoni tagħhom, dejjem jekk il-fatturat annwali fl-Istat Membru kkonċernat matul dawn is-sentejn ma jaqbiżx il-limitu b’aktar minn 50%. Dan jippermetti lill-SMEs f’ċerti setturi, bħas-settur tal-kostruzzjoni, li jiffaċċjaw fatturi staġjonali u domanda irregolari, biex jibbenefikaw minn perjodu aktar fit-tul.”

B’referenza għad-dati ta’ implimentazzjoni, Dr Sant qal li flimkien mal-grupp S & D, qed isostni l-avvanz tagħhom, peress li dawn il-miżuri ta’ simplifikazzjoni tal-VAT jistgħu jiġu implimentati aktar malajr mir-reġim definittiv tal-VAT.

Ir-rapport se jitressaq għal vot nhar l-Erbgħa 11 ta’ Lulju fil-Kumitat ECON u se jiġi diskuss u vvotat aktar tard f’Settembru fil-Plenarja tal-Parlament Ewropew.