Updated at 3.30pm: Adds PL MEPs statement
Socialist MEPs are pushing for the European Commission to consider Malta as a tax haven, the Times of Malta has learnt.
The socialist grouping (S&D) within the European Parliament, which Prime Minister Joseph Muscat’s Labour Party forms part of, this week tabled an amendment to the Panama Papers inquiry committee’s final report (Pana).
The amendment calls on the European Commission to regard Malta, Luxembourg, the Netherlands and Ireland as tax havens.
The amendment tabled by the S&D, points out that according to NSO data, foreign investment in Malta amounts to 1,474 per cent of the size of its economy. Similar data was cited for the other three countries.
EPP MEPs will not be voting in favour of S&D amendment
The proposed amendment by the socialist grouping cites the data as a clear indication that some EU member states were facilitating excessive profit-shifting activities, as the expense of other countries in the European Union.
Maltese Labour MEPs were on the losing side of a vote taking by the S&D on Wednesday, during which the proposed amendment was approved.
The amendment will now be voted upon at the European Parliament in Strasbourg next week.
Sources said that the European Parliament’s largest political family, the European People’s Party (EPP), which Nationalist MEPs form part of, will not be voting in favour of the S&D’s amendment.
Prior to the proposed amendment, the government had welcomed Pana’s report. It said the report refuted any claims of Malta being a tax haven. A number of financial industry stakeholders had also welcomed the report. In a joint statement, industry stakeholders hit out at Malta’s labelling as a tax haven by a number of “ill-informed speakers”.
The Pana committee carried out a fact-finding visit to Malta in February.
In its report about the Malta visit, the Pana committee raised a series of concerns about the institutions in charge of implementing and enforcing rules as regards tax fraud and money laundering.
It cited the Maltese tax system as being very attractive and in line with current international and EU standards with regards to harmful tax competition.
Finance Minister Edward Scicluna, however, admitted that the Maltese tax system can be prone to abuse and confirmed that Malta disagreed with Commission proposals on specific tax issues, the Pana committee said in its report.
In a statement this afternoon, the PN said the European People's Party, which its MEPs formed part of, did not want Malta to get a tax haven status. It was only the Socialists, which the PL's MEPs formed part of, who were requesting this.
If they get their way, the PN said, this would be a blow to Malta's economy and the livelihood of many Maltese families.
The PN said it had been saying for years that Malta was not a tax haven and in spite of several attempts in the past to make it seem like it was, it always managed to convince that this was not the case.
It was still doing so from the Opposition, it said.
In another statement, the PL’s MEPs said they would continue to fight all attempts aimed at undermining Malta’s financial services, wherever they came from. This also applied to when these came from their own political group, they said.
Alfred Sant, Miriam Dalli and Marlene Mizzi said they would continue to work to protect Malta’s taxation system which was confirmed as a transparent one and in conformity with EU laws and OECD standards.
This was also confirmed by the Pana Committee which visited Malta earlier this year.
They said it was clear that their warning that the continuous attempts against Malta would only serve to undermine the country’s financial services was valid.
The reality that there were MEPs who were irked by the fact that Malta was attracting investment so much so that they referred to this in an amendment to the Pana report confirmed that Malta’s taxation system was in conformity to international requisites.
There was in fact clear reference to the fact that foreign direct investment in Malta was much higher than the European average, they said.
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