In an interview with one.com.mt, discussing the financial and economic outlook in Europe in the next five years, PL MEP Dr Alfred Sant has said that the drive to introduce a common tax system for all European countries will remain, if not increase.
Dr Sant explained that there are two schools of thought on the harmonization of tax, which large countries such as Germany and France are urging.
“There are those who want harmonized taxes to be identically structured throughout. There are those who would like that on top of that, all EU countries adopt a minimum tax on corporate profits, which rates are decided by EU member states. Both stances are obviously not in the interest of our country, which has built its economy on services during the last 20 years or so,” stressed Dr Sant.
Dr Sant reiterated that the Maltese MEPs have an obligation to safeguard the individual tax regime and the right to the concept of tax competition, which is crucial for a country like Malta, which economy is based on services.
Dr Sant went on to explain that the current systems should not allow for tax evasion or money laundering. Referring to Maltese MEPs he said, “They have a duty to be ready to put forward technical arguments, be professional and serious and reflect a Maltese national context to show why they disagree and not be included in these initiatives. This while we agree that the existing taxation systems should not be used by individuals or companies to evade tax or to hide dirty money.”
On discussions regarding the EU budget for the years 2021-2027, Dr Sant said that in addition to issues related to the Common Agricultural Policy and the Cohesion Fund, one of the biggest factors for the delay in this budget to be finalized is a proposal that European funds are to be linked to the member states’ rule of law. Dr Sant also said that there are those who are proposing spending on the bloc’s defence.
Dr Sant also stressed that the biggest challenge facing new president of the European Central Bank, Christine Lagarde, is to convince European governments to adopt more open fiscal policies, something in which the outgoing President, Mario Draghi was unsuccessful.