Edward Scicluna u l-bajtar tax-xewk

Iktar kmieni din il-ġimgħa, l-President tal-Kummissjoni tal-Unjoni Ewropea, Ursula von der Leyen, ippreżentat lill-Parlament Ewropew pjan ta’ €750 biljun biex inqumu fuq saqajna. Pjan li jista’ jiġġenera investiment stmat €3.1 triljun fl-ekonomija Ewropea. Permezz ta’ għotjiet flimkien ma’ self, il-Kummissjoni Ewropea qed tfittex li tegħleb l-impatti ekonomiċi negattivi tal-Covid-19 kif ukoll li tagħti bidu għall-azzjoni meħtieġa biex ikun implimentat il-Ftehim l-Aħdar (the Green Deal).

It-triq biex nirkupraw mhiex faċli. Mhux il-każ li mmorru lura għal kif konna. Dak spiċċa. Irridu nimxu l-quddiem lejn normal ġdid. Li nintegraw flimkien il-ħidma biex nirkupraw mill-impatti tal-pandemija flimkien mal-azzjoni meħtieġa dwar it-tibdil fil-klima mhux ser tkun faċli imma hi essenzjali u mhux possibli li tkun posposta. Kif ġie emfasizzat fuq Euroactive nhar l-Erbgħa, it-triq biex nirkupraw tiddependi minn ħafna kundizzjonijiet konnessi mal-ambjent. 25 fil-mija tal-finanzjament propost mill-Kummissjoni Ewropeja hu fil-fatt marbut ma’ ħidma klimatika.

Edward Scicluna, il-Ministru tal-Finanzi, fl-ewwel reazzjoni tiegħu għall-pjan tal-Kummissjoni ikkummenta mħasseb dwar miżuri prattiċi konnessi mal-klima. Bħala gżira ser inweġġgħu ħafna qal, jekk jindirizzaw l-emissjonijiet tal-ajruplani u l-vapuri. Il-pjan, qal Edward Scicluna, jixbah lill-bajtar tax-xewk. Scicluna jippreferi li ma jsir xejn ħlief paroli. L-anqas m’hu jieħu pjaċir b’dak li qed jingħad dwar it-tassazzjoni tal-kumpaniji, avolja konxju li m’għadx baqa’ żmien biex fl-Unjoni Ewropea tħajjar kumpaniji jibqgħu jħarbu l-obbligi tagħhom tal-ħlas tat-taxxi.

Hu korrett li jingħad li ser nintlaqtu bil-miżuri dwar il-klima. Hekk għandu jkun, għax il-ħidma tagħna għandha impatt fuq il-klima. Nistgħu imma ninnegozjaw biex dawn l-impatti fuqna jonqsu mingħajr ma nnaqqsu l-impenn (reali) tagħna biex ikunu indirizzati l-impatti klimatiċi tal-industrija tal-avjazzjoni u tal-vapuri. Bla ebda dubju dan ser ikun ifisser impatti sostanzjali kemm fuq it-turiżmu kif ukoll fuq il-kummerċ.

Dan ma jistax ikun evitat għax dawn l-industriji għandhom l-obbligu li huma ukoll jġorru fuq spallejhom l-impatti li qed jikkawżaw. Dak hu li wegħdna bħala pajjiż fis-Summit ta’ Pariġi dwar il-klima. Wasal il-waqt li nwettqu dak li ġie imwiegħed. Biex niġu fuq saqajna irridu nfasslu l-futur mill-ġdid. Il-ħsara li teħtieg li tissewwa mhiex biss dik ekonomika u ambjentali. Jinħtieġ li tul l-Unjoni Ewropea kollha nibnu s-solidarjetà fuq pedamenti sodi. Dak li Edward Scicluna jqis bħala l-bajtar tax-xewk huma fil-fatt l-għodda bażiċi tas-solidarjetà.

Għax is-solidarjetà hi meħtieġa mhux biss meta aħna bir-raġun kollu nokorbu ma’ kull mewġa ta’ immigranti fl-ibħra Maltin. Is-solidarjetà hi dak li Malta tinjora meta tfittex li tkun attraenti għal min irid jevadi t-taxxi f’pajjiżu: dawk li jħallsu ftit lill-kaxxa ta’ Malta biex jevitaw milli jħallsu l-biljuni band’oħra. Il-politika dwar l-armonizzazzjoni tat-tassazzjoni fl-Unjoni Ewropea hi r-risposta bis-sens għall-politika li tinkoraġixxi l-evażjoni tat-taxxa f’Malta, l-Olanda, il-Lussimburgu u l-Irlanda.

L-Oxfam f’rapport ippubblikat fl-2019 u ntitolat “Off the Hook. How the EU is about to whitewash the world’s worst tax havens” temfasizza li “l-Irlanda, il-Lussimburgu, Malta u l-Olanda huma fost il-pajjiżi li l-iktar jinkoraġixxu l-evażjoni tat-taxxa fid-dinja, b’mod li jagħmluha possibli li kumpaniji kbar jirnexxielhom iħallsu ammont żgħir ta’ taxxa. Per eżempju, ir-regoli internazzjonali tat-taxxa jippermettu lill-Vodafone Group Plc biex jallokkaw kważi 40 fil-mija tal-profitti taxxabbli tagħhom f’Malta u l-Lussimburgu.”

Rajna ukoll rapporti dwar il-BASF, ġgant fl-industrija kimika fil-Ġermanja, li jispjegaw kif din tevadi t-taxxa. Fir-rapport tal-Ħodor Ewropej ippubblikat fl-2016, intitolat “Toxic Tax Deals. When BASF’s Tax Structure is more about style than substance” kien spjegat kif il-BASF irnexxiela tevadi madwar biljun euro f’taxxa, u minflok ħallset ammonti żgħar bil-kompliċità ta’ Gvernijiet Maltin: ħomor u blu.

Jeħtieġ li l-ewwel u qabel kollox nirkupraw l-imġieba etika tagħna, anke qabel ma nirkupraw ekonomikament u ambjentalment. Ir-riġenerazzjoni tal-valuri tagħna għandha tkun prijorità qabel ma nippruvaw insewwu l-kaxxa ta’ Malta li minnha, bħalissa ħerġin il-flus maħmuġin akkumulati mill-bejgħ tal-passaporti. Flejjes miġburin minn persuni bħall-biljunarju Russu Boris Mints, l-Eġizzjan Mustafa Abdel Wadood, il-biljunarju Ċiniż Liu Zhongtian, in-negozjant Russu Pavel Melenikov u l-Iżraeli Anatoly Hurgin, li irnexxielhom jiżgiċċaw minn eżami suppost rigoruż u ngħataw iċ-ċittadinanza Maltija: però xorta spiċċaw għaddejjin proċeduri kriminali f’diversi pajjiżi oħra primarjament dwar frodi u ħasil tal-flus!

F’dan iż-żmien ta’ ħtieġa l-Ministru tal-Finanzi Edward Scicluna spiċċa dipendenti fuq flejjes li oriġinaw minn dawn is-sorsi maħmuġin. Ma tkunx esaġerazzjoni li ngħid li spiċċa dipendenti minn flus li oriġinaw mill-kriminalità.

Fir-reazzjonijiet tagħha għall-proposti tal-Kummissjoni tal-Unjoni Ewropea Evelyne Huytebroech, waħda miż-żewġ mexxejja tal-Partit tal-Ħodor Ewropej, emfasizzat li din il-proposta flimkien ma dik tal-Parlament Ewropew u l-proposta Franco-Tedeska ilkoll qed jaraw proċess ta’ self komuni. Dan hu pass il-quddiem għas-solidarjetà Ewropea. Għax is-solidarjetà tinbena bil-mod u bit-tbatija. Imma għal Edward Scicluna dan kollu bajtar tax-xewk!

ippubblikat fuq Illum :il-Ħadd 31 ta’ Mejju 2020

The recovery plan and Edward Scicluna’s prickly pears

Earlier this week, EU Commission President Ursula von der Leyen, presented for the consideration of the European Parliament a recovery plan worth €750 billion but which can unleash an investment estimated at €3.1 trillion in the EU economy. Through a combination of loans and grants the EU Commission seeks to integrate the reversal of the economic downturn resulting from the Covid-19 pandemic together with the action required to implement the Green Deal.

The road to recovery will be tough. It is not the case of going back to normal but of going forward to a new normal. Integrating the recovery from the pandemic impacts with climate change action will not be easy but it is essential and cannot be postponed. As emphasised by Euroactive on Wednesday, the road to recovery has plenty of green strings attached. 25 per cent of the funding proposed by the EU Commission is in fact earmarked for climate action.

Finance Minister Edward Scicluna, in his first reaction to the recovery plan, voiced concern on practical climate action measures. It hurts, he says, to address air traffic emissions or shipping pollution. As an island this would impact us substantially. The proposed recovery plan is comparable to prickly pears, he stated. He prefers the status quo: all talk and little walk. Edward Scicluna is not amused by rumblings heard on corporate taxation even though he is well aware that the days of attracting corporations seeking tax havens within the EU may well be numbered.

It is correct to state that we will be impacted substantially. We can however negotiate to reduce such impacts without diminishing our commitment to addressing climate change impacts of the airline and shipping industry. This would mean significant impacts on tourism and trade. These however cannot be avoided as climate change impacts have to be internalised: that is they have to be shouldered by the industries generating them. This is what we promised in the Paris Climate Summit. Promises that we must now honour.

Operation recovery must re-design the future. It must not be just an economic recovery or an environmental rebirth. It must also be a recovery of practical solidarity all over the Union. What Edward Scicluna views as prickly pears are in fact instruments of solidarity.

Solidarity is not just what we rightly cry for when immigrants crash through our borders. Solidarity is what we ignore when Malta insists on being attractive to tax evaders: those who pay peanuts to the Maltese exchequer in order to avoid paying billions elsewhere. The issue of tax harmonisation on an EU level is the sensible response to the tax haven fiscal policies of Malta, the Netherlands, Luxembourg, and Ireland.

Oxfam in its 2019 report entitled “Off the Hook. How the EU is about to whitewash the world’s worst tax havens” emphasises that “Ireland, Luxembourg, Malta and the Netherlands are among the most significant tax havens in the world, enabling some of the biggest corporations to pay minimal amounts of tax. For example, currently, international tax rules allow Vodafone Group Plc to allocate nearly 40% of its taxable profits to Malta and Luxembourg.” We have also seen reports on BASF clearly explaining how the German chemical giant avoids paying taxes due. The European Greens report “Toxic Tax Deals. When BASF’s Tax Structure is more about style than substance” published in 2016 had outlined how BASF had successfully avoided close to a billion euros in tax, paying just a small amount thanks to Maltese governments blue and red.

The recovery must be primarily ethical before being economic and environmental. Regenerating our values should be a priority higher on the list than the regeneration of our coffers, currently dishing out dirty money originating from the sale of citizenship schemes. Monies collected from the likes of Russian billionaire Boris Mints, Egyptian national Mustafa Abdel Wadood, Chinese billionaire Liu Zhongtian, Russian businessman Pavel Melenikov and Israeli Anatoly Hurgin, who slipped through what is described as a rigorous due diligence process and gain Maltese citizenship only to be prosecuted in different jurisdictions for various crimes primarily fraud and money laundering.

It is indeed telling that in time of need Finance Minister Edward Scicluna is dependent on monies originating from such dubious sources! It would not be an exaggeration to state that he is dependent on the proceeds of crime.

In her reaction to the EU Commission proposals Evelyne Huytebroech co-Chair of the European Greens emphasised that the EU Commission’s proposal together with the proposals of the EU Parliament and the Franco-German initiative all foresee a mutualised debt instrument: a major breakthrough for European solidarity. Solidarity is constructed slowly and painfully, while Edward Scicluna juggles with his prickly pears.

published in The Malta Independent on Sunday : 31 May 2020

Il-governanza tajba tinbena fuq it-transparenza

It-transparenza hi l-pedament essenzjali għal governanza tajba. B’kuntrast ma dan, il-governanza ħażina, ġeneralment, tkun akkumpanjata mis-segretezza u dan billi jinżamm jew ikun ostakolat l-aċċess għal informazzjoni ta’ kull xorta, liema informazzjoni għandha tkun pubblika.

Il-ħmieġ assoċjat mal-Panama Papers sirna nafu bih fil-mument li nkixfet l-informazzjoni dwar dawk li fittxew l-irkejjen tad-dinja fejn hi inkoraġġita s-segretezza: irkejjen fejn jinħbew il-flus ġejjin mill-korruzzjoni u mill-evażjoni tat-taxxi. Bl-istess mod l-iskandlu tal-Vitals dwar l-isptarijiet kif ukoll it-taħwid kollu assoċjat mal-power station ma kienux iseħħu kieku l-Partit Laburista fil-gvern għażel it-trasparenza flok is-segretezza bħala għodda essenzjali għat-tmexxija. Segretezza li kultant twaħħxek.

Il-kontabilità li tant niftaħru biha, wara kollox, hi dwar ir-responsabbiltà. Tfisser l-għarfien tar-responsabbiltà għal dak li nagħmlu. Dan ma jistax iseħħ jekk ma ssaltanx it-trasparenza, dejjem, u mhux biss meta jaqbel.

Il-ġimgħa l-oħra, l-Kamra tal-Kummerċ ippubblikat dokument bil-ħsibijiet tagħha dwar il-ħtieġa li tkun inkoraġġita u msaħħa l-governanza tajba. Kien f’loku li l-Kamra tal-Kummerċ emfasizzat li l-governanza tajba hi msejsa fuq it-trasparenza, l-kontabilità u s-saltna tad-dritt.

Spiss jingħad li l-informazzjoni hi poter. It-transparenza hi dwar dan il-fatt: li jkun assigurat li l-poter jinfirex. Għax hu biss meta jkollna għarfien ta’ dak li qed jiġri li nkunu nistgħu neżerċitaw id-dritt bażiku tagħna bħala ċittadini li neżiġu illi kull min jiddeċiedi, u allura jeżerċita l-poter, jagħti kont ta’ egħmilu, dejjem.

Il-politiċi mhumiex l-uniċi li jieħdu d-deċiżjonijiet. Dawn jinkludu liċ-ċivil u lil dawk li jmexxu l-awtoritajiet u l-istituzzjonijiet imwaqqfa biex jiffaċilitaw l-amministrazzjoni tal-istat fit-twettieq tal-funzjonijiet u d-dmirijiet tiegħu.

It-trasparenza teħtieġ li tinfirex anke fid-dinja tal-kummerċ. Spiss nisimgħu lil min jemfasizza li l-politika m’għandiex tindaħal fis-settur privat, fid-dinja tan-negozju. Għal uħud għadu mhuwiex ovvju li anke s-settur privat, u in-partikolari id-dinja tan-negozju, għandu joqgħod lura milli “jindaħal” fil-politika. Fost affarijiet oħra dan ifisser il-ħtieġa li jkun regolat il-lobbying. Dan ma jsirx billi il-lobbying ikun ipprojibit imma billi kull attività ta’ lobbying tkun transparenti. Għax jekk il-lobbying isir sewwa jista’ ikollu impatt posittiv fuq it-tfassil tad-deċiżjonijiet. Hi is-segretezza li tagħti fama ħażina lill-lobbying, segretezza intenzjonata biex ixxaqleb id-deċiżjonijiet lejn interessi kummerċjali u fl-istess ħin biex tostor it-taħwid.

Huwa f’dan id-dawl li l-inizjattiva tal- Ministru l-ġdid għall-Ambjent Aaron Farrugia li jżomm lista tal-laqgħat kollha tiegħu ma’ dawk li jfittxu li jiltaqgħu miegħu, inkluż mal-utenti, u li jippubblika din l-informazzjoni fil-forma ta’ reġistru ta’ trasparenza hi pass kbir ‘il quddiem. Din l-inizjattiva hi f’waqtha u hi ta’ eżempju lill-politiċi oħrajn biex huma ukoll jipprattikaw it-transparenza. Dan imma għandu jkun biss l-ewwel pass li jeħtieġ li jkun segwit bil-pubblikazzjoni ta’ proposti u dokumenti li l-Ministru jirċievi waqt dawn il-laqgħat, kif ukoll il-minuti tal-laqgħat li jkunu saru.

Hu magħruf li l-Kummissarju dwar l-Istandards fil-Ħajja Pubblika qed iħejji biex jippubblika abbozz ta’ proposti dwar ir-regolamentazzjoni tal-lobbying biex eventwalment tkun tista’ issir konsultazzjoni pubblika dwarhom. Nittama li dan iwassal għal sitwazzjoni fejn f’dan il-qasam Aaron Farrugia ma jibqax l-eċċezzjoni. Il-bqija tal-membri tal-Kabinett m’għandhomx jibqagħlhom għażla. Għandhom ikunu kostretti li huma wkoll jaġixxu biex it-transparenza fil-ħidma politika tkun ir-regola u mhux l-eċċezzjoni.

Għax huwa biss meta it-transparenza jkollha egħruq fondi u b’saħħithom li nistgħu nibdew intejbu d-demokrazija tagħna billi neliminaw id-difetti li tħallew jakkumulaw tul is-snin.

 

ippubblikat fuq Illum : Il-Ħadd 26 ta’ Jannar 2020

Good governance is founded on transparency

Transparency is the indispensable foundation of good governance. In contrast, bad governance is generally wrapped in secrecy through the withholding of information which should be in the public domain.

The Panama Papers saga saw the light of day when information on those seeking secretive jurisdictions was made public. These locations are sought to hide  the fruits of corruption or tax evasion from public scrutiny. Similarly, the Vitals hospital scandal, as well as the power station scandal, with all their ramifications, would undoubtedly not have occurred if the Labour Party in government had embraced transparency instead of entrenching secrecy as its basic operational rule.

Transparency is a basic characteristic of good governance whereas secrecy is the distinguishing mark of bad governance, inevitably leading to unethical behaviour and corruption.

Without transparency, accountability is a dead letter; devoid of any meaning. A lack of transparency transforms our democracy into a defective process, as basic and essential information required to form an opinion on what’s going on is missing. After all, accountability is about responsibility: it signifies the acknowledgement and assumption of responsibility for our actions. This cannot be achieved unless and until transparency reigns supreme.

Last week, the Chamber of Commerce published its views on the need to reinforce good governance. Pertinently it emphasised that good governance is founded on transparency, accountability and the rule of law.

It is said that knowledge (and information) is power. This is what transparency is all about: ensuring that power is shared by all as it is only when we are aware as to what is going on that we can exercise our basic right as citizens: holding decision-takers to account. Being in possession of information gives each and every one of us the power to act and exercise our civic rights.

Holders of political office are not the only decision-takers. Decision-takers include the civil service as well as those running authorities and institutions established to facilitate the administration of the state in carrying out its functions and duties.

Even business leaders should be transparent in their actions and decision-taking. Many a time we have heard the expression “we should take politics out of business”, signifying that politics should not interfere in the private sector.

To some it is less obvious that the reverse of that is just as important, meaning that we should also “take business out of politics”. Among other things, this signifies that we should regulate lobbying. This is not done by prohibiting lobbying but by focusing the spotlight of transparency on all lobbying activity. If lobbying is done properly, it could have a beneficial impact on policy making. It is secrecy that gives lobbying a bad reputation: a secrecy intended to derail decisions in a manner beneficial to the different lobby groups as well as to facilitate and shroud underhand deals.

In this respect the initiative of the newly appointed Environment Minister Aaron Farrugia to log all of his meetings with lobbyists and stakeholders and to publish a Transparency Register is a welcome step in laying solid foundations for the practice of transparency by holders of political office. It is, however, only a first step and must be eventually followed by the publication in real time of proposals received as well as the minutes of meetings held.

It is known that the Commissioner for Standards in Public Life will shortly be publishing proposals for the regulating of lobbying. Hopefully, this should lead to a situation where Aaron Farrugia would not be an exception. Others will be compelled to not only follow in his footsteps but to proceed much further in entrenching transparency in the working methods of holders of political office.

A deep-rooted commitment to transparency is the only way by which we can start repairing our defective democracy.

 

published in The Malta Independent on Sunday : 26 January 2020

The budget: beyond the €s

Liza Minelli’s song “Money makes the world go round” is the underlying theme of the Budget speech delivered by Finance Minister in Parliament last Monday. The message driven home was that money and the accompanying affluence clearly indicate that we have never had it so good and that handouts to all are not a problem, both to those who need them, and, more importantly to those who don’t.

Today, taxation is a dirty word in our political lexicon: hence, it was suggested that the message that no increases in existent taxes or new taxes have been proposed is a positive one by the Honourable Minister. Handouts are for all, almost. First for those in need, secondly for most of the rest. The dictum “from each according to his means, to each according to his needs” no longer has any significance when trying to understand the political philosophy underlying the budget of this “labour” government.

Taxation collected in Malta apparently only has some significance when taxing foreign companies operating outside Maltese territory but having some small office, or just a letterbox, on this rock. This is done so that they can avail themselves of reduced taxation rates, substantially lower that those payable in the countries where they operate.

Similarly, companies operating in the financial services sector benefit from a tax package which offers them substantial savings on their tax bills in order to entice them to set up shop.

The government thinks it is smart, but all it is doing is encouraging tax avoidance. Malta’s message is clear: those who want to avoid tax in their country are welcome as long as they are prepared to pay a small part of the taxes avoided to the Maltese exchequer.

In this respect, the case study entitled “Toxic Tax Deals. When BASF’s Tax Structure is more about style than substance” published by the Green Group in the European Parliament around two years ago is indicative. In that study, it was concluded that BASF, the German chemical giant with its headquarters in Ludwigshafen, used mismatches in national tax systems in order to avoid paying its taxes. It is estimated that, over a five-year period spanning 2010 to 2014, BASF avoided the payment of close to one billion euros in taxes, paying instead a small amount of the taxes avoided, in gratitude for this wonderful opportunity made possible by the Maltese governments, blue and red.

In this context the Finance Minister’s declaration against tax evasion, tax avoidance and money laundering is deemed mere rhetoric. It has to be viewed in the context of the Panama Papers saga, as well as the established fact that a Cabinet Minister and the Chief of Staff in the Office of the Prime Minister set up companies in Panama, a tax haven, and no punitive action was taken against them. With this background, the Minister’s sanctimonious declaration is in no way credible.

The Budget proposals strengthen the social safety net as it assists the vulnerable financially. However, the quality of life is not measured solely by financial metrics. The Budget has various green gaps that affect our quality of life.

The welfare of cars assumes an importance over human quality of life, as government considers it is important to widen and improve roads in order to facilitate the passage of cars, thereby aiming at reducing congestion. An inverted sense of logic: reduction of the number of cars on our roads should have been the target as that is the real and actual problem. Widening roads and improving road infrastructure with flyovers and underpasses only serves to grow the number of cars on our roads, thereby increasing the problem. Providing and facilitating alternative transport is the only solution. Paying lip service to alternative means of transport but simultaneously financing an exponential
increase of the problem signifies that we still have to learn the ABC of transport policy.

The government’s own transport master-plan places considerable emphasis on the need to reduce cars from our roads but it seems that the government is not interested.

Therefore, we have a government which is more interested in the welfare of cars than in our quality of life.

This is just one example. There are countless of others.

The Budget loses an opportunity to make a lasting difference in a number of areas important for our quality of life that goes beyond finances.

published (online) at Malta Independent

Il-baġit : lil hinn mill-€s

Id-diska ta’ Liza Minelli “Money makes the world go round” donnha li hi t-tema li madwarha hu minsuġ id-diskors tal-Baġit li nqara mill-Ministru tal-Finanzi nhar it-Tnejn fil-Parlament. Il-messaġġ ċar li wasal fi djarna kien li l-flus u l-“ġid” li hawn jagħmlu possibli li tirċievi ċekk id-dar, kemm jekk għandek bżonnu kif ukoll jekk m’għandekx.

F’dawn iż-żmienijiet il-kelma taxxa donna saret kelma moqżieża fid-dizzjunarju politiku: għalhekk ġie suġġerit li n-nuqqas ta’ taxxi ġodda, inkella ta’ żieda fit-taxxi eżistenti kien element pożittiv fid-diskors tal-Onorevoli Ministru. Ċekkijiet għal kważi kulħadd. L-ewwel għal dawk li għandhom il-ħtieġa u mbagħad għall-parti l-kbira tal-bqija. Dak li kien jingħad li “jittieħed mingħand kull wieħed skont ma jiflaħ, u jingħata lil kulħadd skont il-ħtiġijiet tiegħu” donnu li ma għandu l-ebda piz illum meta nippruvaw nifhmu l-filosofija politika li fuqha hu mfassal dan il-baġit ta’ Gvern “Laburista”.

It-taxxa li tinġabar f’Malta donnha li hi utli biss meta tinġabar mingħand kumpaniji barranin li fil-waqt li joperaw barra mit-teritorju Malti jkollhom uffiċċju żgħir jew sempliċi letterbox f’Malta. Dan biex ikunu jistgħu jibbenefikaw minn rati ta’ taxxa sostanzjalment iktar baxxi minn dawk li jkunu soġġetti għalihom fil-pajjiżi fejn joperaw.

Diversi kumpaniji fis-settur tas-servizzi finanzjarji ukoll jibbenefikaw minn rati ta’ taxxa li bihom jiffrankaw sostanzjalment minn dak li jħallsu band’oħra.

Il-Gvern mingħalih li għamel opra. Fir-realtá qed jibgħat messaġġ li Malta tilqa’ li min irid jevadi t-taxxa f’pajjiżu, kemm-il darba jkun lest li jħalli xi ħaġa minn dak li jiffranka fil-kaxxa ta’ Malta!

F’dan il-kuntest l-istudju intitolat Toxic Tax Deals. When BASF’s Tax Structure is more about style than substance. ippubblikat mill-Grupp tal-Ħodor fil-Parlament Ewropew madwar sentejn ilu jispjega b’mod ċar x’inhu jiġri. F’dan l-istudju ġie konkluż li l-BASF, ġgant Ġermaniz fil-qasam tal-industrija kimika ibbazat f’Ludwigshafen, jagħmel użu minn differenzi fis-sitemi nazzjonali tat-taxxa biex jevita milli jħallas it-taxxi dovuti. Huwa stmat li, tul il-ħames snin bejn l-2010 u l-2014, BASF evitaw madwar biljun euro fi ħlas ta’ taxxi. Minflok ħallsu ammonti ferm inqas, b’ħajr lill-gvernijiet Maltin (blu u ħomor) talli għinhom jevitaw dawn it-taxxi kollha.

F’dan il-kuntest id-dikjarazzjoni tal-Ministru tal-Finanzi kontra l-evażjoni tat-taxxa u l-ħasil tal-flus jidhru dak li fil-fatt huma: eżerċizzju ta’ retorika. Inżommu f’moħħna ukoll il-kaz tal-Panama Papers, li kien stabilixxa l-fatt li membru tal-Kabinett u ċ-Chief of Staff fl-uffiċċju tal-Prim Ministru kellhom kumpaniji fil-Panama, pajjiż rinomat għall-evażjoni tat-taxxa, u dwar dan ma kienu ittieħdu l-ebda passi kontra tagħhom. Fid-dawl ta’ dan, id-dikjarazzjoni ta’ “qdusija” da parti tal-Onorevoli Ministru hi nieqsa minn kull kredibilitá.

Il-proposti tal-Baġit isaħħu ix-xibka soċjali u dan billi jgħinu finanzjarjament lill-vulnerabbli. Imma l-kwalitá tal-ħajja ma titkejjilx biss f’termini ta’ flus. Fil-Baġit hemm bosta miżuri ambjentali nofs leħja.

Il-ħarsien tal-karozzi huwa iktar importanti mill-kwalitá tal-ħajja għalina. Il-Gvern jikkunsidra li hu iktar importanti li jwessa’ t-toroq biex jiffaċilita ċ-ċaqlieq tal-karozzi u b’hekk jipprova jnaqqas il-konġestjoni. Loġika rasha l-isfel. Il-mira kellha tkun it-tnaqqis tal-karozzi mit-toroq tagħna għax dik hi l-problema. It-twessiegħ tat-toroq u t-titjib tal-infrastruttura bil-kostruzzjoni ta’ flyovers lil hawn u lil hemm iwassal biss għaż-żieda ta’ karozzi fit-toroq tagħna u b’hekk tikber il-problema tal-konġestjoni. L-unika soluzzjoni hi li jkun inkoraġġit bis-serjetá t-trasport alternattiv. Il-Gvern qiegħed fl-istess nifs jinkoraġixxi kemm lit-trasport alternattiv kif ukoll iż-żieda fenomenali ta’ karozzi: dan ifisser li għadu ma tgħallem xejn. Wara kollox huwa l-pjan nazzjonali tat-trasport imfassal minn dan il-Gvern stess li jpoġġi quddiemna l-mira tat-tnaqqis tal-karozzi mit-toroq tagħna. Imma jidher li l-Gvern qed iwarrab il-pjani tiegħu stess.

L-Gvern hu iktar interessat mill-ħarsien tal-karozzi milli mill-ħarsien tal-kwalitá tal-ħajja tagħna lkoll.

Dan hu biss eżempu wieħed. Hemm bosta oħrajn.

Il-Baġit qed jitlef l-oportunitá li jagħmel differenza f’numru ta’ oqsma fejn li troxx il-flus mhux biżżejjed.

 

Ippubblikat fuq Illum: Il-Ħadd 28 t’Ottubru 2018

Taming the residential rental market

The proposals in the White Paper entitled Renting as a Housing Alternative is a breath of fresh air in the long overdue debate on the need to regulate the rental market for residential property.

As rightly pointed out in the White Paper, the Maltese community has developed an allergy to local rent regulation as, when it existed, it was generally too rigid. It oscillated from strict over-protection of the tenant to absolutely no controls.

For a very long time, we also ended up with temporary legislative provisions enacted during the war which were over-stretched too long after their useful life. In effect, this reluctance over the years to introduce proper landlord and tenant legislation effectively killed off the rental market for a long time and it is only as a result of this fact that Malta is a nation of home-owners: it would not have developed in this way, had the post-war governments got their priorities right.

The proposals put forward by the White Paper are generally a good step forward. If properly implemented, they will go a long way towards laying the foundations for a stable residential rental market based on adequate (and necessary) protection of both landlords and tenants. A serious debate is, however essential in order to avoid creating unnecessary difficulties.

The rental market is currently in a state of anarchy, where the only applicable rules that apply are those of the jungle – where might is right – because, so far, the state has abdicated its duties to protect the vulnerable from the excesses of the market. Subject to the three exceptions listed in the White Paper (temporary foreign workers, tertiary education students and temporary leases for persons repairing and/or upgrading their own homes) establishing the period of one year as the minimum length of a residential lease addresses the abuse currently resulting from short-term leases. Likewise, establishing as a duty of landlords to give a suitable notice period of their intention not to renew a lease is right and proper. It is in everybody’s interest that everyone is aware of their rights and duties, as this will lead to better planning on all sides and, consequently, to a more stable and civil relationship between landlords and tenants.

It was also about time that the deposit requested on the signing of lease agreements are properly regulated – both as to the actual need for a deposit, its quantum and the circumstances in which it would be reasonable for it not to be refunded. This is a subject about which countless stories of actual abuse on the part of both landlords and tenants abound and regulation of it will bring some sense into the subject.

It is also right that variations to the rent to be paid during the period of the lease are properly regulated,  thereby defining the limits of permissibility. Too strict a limitation, however, will lead to a preponderance of short-term lease agreements because the market prefers frequent rental revisions that enable the rent payable to be as close as possible to the full market value.

Registering lease agreements is a step forward. It will not only lead to a check to  ensure that agreements comply with the new legislation but will also have the potential to ensure that tax evasion associated with rent paid is history.

When considering the White Paper’s proposals, one should avoid introducing unnecessary exceptions as these will only serve to stultify the objective of the exercise: the development of a stable rental market for residential properties. In particular, the proposal in the White Paper to justify the premature determination of a lease agreement, when a landlord needs the property for his own use or in order to sell with vacant possession or else to redevelop it, is uncalled for. Given that the residential leases in question will most probably be short-term leases anyway (between one and five years) no harm will be done to anyone if the landlord patiently awaits until the end of the lease before taking back possession.

The current proposals, with the one exception referred to above, are an essential next step to help the residential rental market develop properly. On their own, however, they are insufficient because they must be supported by a Housing Authority that proactively addresses the needs of the vulnerable when facing the market, which is eager to fleece those who meekly submit themselves as they see no way of becoming homeowners!

 

published in The Malta Independent on Sunday – 22 October 2018

Undermining the rule of law

The “rule of law” is a basic democratic principle codified in the laws of democratic countries.

We are all servants of the law in order to be free and in a democracy, the law should apply to one and all without exception. A weak “rule of law” thus results in less and less democracy until one is left with only a free-standing façade.

The law is there to be observed: it should be a constraint on the behaviour of individuals as well as on that of institutions. All individuals ought to be subject to the same laws, whereas institutions are there to protect us all, not just from ourselves but also from all possible attempted abuse of authority by the institutions themselves.

It is within this context that the report of the ad hoc delegation of the Committee of Civil Liberties, Justice and Home Affairs of the European Parliament has to be considered. The report is an illustration of how others see the state of our democracy, even though at points it may be inaccurate.

The delegation’s brief was to investigate “alleged contraventions and maladministration in the application of Union law in relation to money laundering, tax avoidance and tax evasion”.

The observations and conclusions of the delegation in its 36-page report are certainly not edifying. The common thread running through the different pages of the report is that in Malta there are more masters of the law than servants; this is how others see us.

In my opinion they are not far off the mark. The report repeatedly emphasises the point that the law should be observed in both letter and spirit.

The institutions in Malta are very weak. I would add that they are weak by design, in other words they are designed specifically to genuflect when confronted by crude political power. This is reflected both in the type of appointees as well as in the actual set-up of the institutions which are supposedly there to protect us.

The above-mentioned report observes, for example, that none of the Financial Intelligence Analysis Unit (FIAU) reports on Maltese politically exposed persons (PEPs) were investigated by the Police, notwithstanding the fact that the said reports had been forwarded to them “for any action the Police may consider appropriate”.

Is it too much to expect that the police do their duty in at least investigating? The fact that no such investigation was carried out drives home the clear unequivocal message that for the police, PEPs are not subject to the law like any other person. The EU Parliament report is very clear as to why such investigations are essential. In fact it is stated that: “Persons perceived to be implicated in serious acts of corruption and money- laundering, as a result of Panama Papers revelations and FIAU reports, should not be kept in public office and must be swiftly and formally investigated and brought to justice. Keeping them in office affects the credibility of the Government, fuels the perception of impunity and may result in further damage to State interests by enabling the continuation of criminal activity.”

The question to be asked is: why is this possible? Why do Maltese authorities tend to bend the rules or close an eye here and there?

You may find an indication as to why this is so in two small incidents occurring in Malta this year. These illustrate the forma mentis of the Maltese “authorities”.

The first example is associated with the fireworks factory at Iż-Żebbiegħ. After 30 years in Court the rural community of iż-Żebbiegħ won a civil case as a result of which a permit for a fireworks factory was declared null and void by the Court of Appeal. The government reacted by rushing through Parliament amendments to the Explosives Ordinance. These amendments with approved by Parliament with the full support of the Opposition. As a result, notwithstanding the decision of the Court of Appeal, a permit for the fireworks factory can still be issued.

The second example is still “work in progress”. The Court of Appeal has, in the application of rent legislation, decided that the Antoine de Paule Band Club in Paola was in breach of its lease agreement. As a result the Court of Appeal ordered the eviction of the band club from the premises they leased within four months.

The government reacted by publishing proposed amendments to the Civil Code, as a result of which the eviction ordered by the Court of Appeal will be blocked.

These are two examples of the government reacting to decisions of our Courts of Law by moving the goalposts – with the direct involvement of the Opposition. The public reactions to these two cases have been minimal. Maltese public opinion has become immune to such “cheating” and bending of the rules because this method of operation has become an integral part of the way in which our institutions function. The Opposition is an active collaborator in this exercise that undermines the rule of law in Malta.

Is it therefore reasonable to be surprised if this “cheating” and bending of the rules is applied not just in minor matters but in very serious ones too? Moving the goalposts whenever it is politically expedient is, unfortunately, part of the way in which this country has operated to date. It is certainly anything but democratic and most obviously anything but respectful towards the rule of law.

published in The Malta Independent on Sunday : 20 May 2018

Pilatu fid-dawl tax-xemx

L-istorja dwar Egrant Inc. ilha sena fl-aħbarijiet. Ilha tinħema 4 snin minn ftit wara l-elezzjoni ġenerali tal-2013 meta twaqqfet flimkien ma kumpaniji oħra.

L-ewwel kellna lil Konrad Mizzi bil-kumpanija tiegħu Hearnville Inc.. Ftit wara Keith Schembri bil-Kumpanija tiegħu Tillgate Inc.. Ħin minnhom daħal fl-istorja Adrian Hillmann tat-Times of Malta ma kumpaniji oħra fil-Panama u fpostijiet oħra. Hillmann kien l-uniku wieħed sissa li irriżenja (jew ġie mġiegħel jirriżenja).

L-istorja, kif bla dubju tiftakru, saret waħda pubblika wara li nkixfu l-Panama Papers. Miljuni ta dokumenti sigrieti dwar diversi kumpaniji imwaqqfa minn persuni pubbliċi u privati madwar id-dinja kollha ma baqawx iktar sigrieti. Inkixfu u tperrċu mal-erbat irjieħ tad-dinja.

Il-qalba tal-problema mhiex il-ħolqien tal-kumpaniji imma l-iskop li għalih dawn jitwaqqfu. Kumpaniji sigrieti, kif għidt fartiklu ieħor ma jinħolqux biex fihom jitfaddlu d-domni jew is-santi. Dawn il-kumpaniji jitwaqqfu biex fihom jinħbew flejjes u assi oħra min għajnejn l-awtoritajiet. Dan il-ħabi jsir għal żewġ raġunijiet : biex ikun evitat il-ħlas tat-taxxi, u/jew biex jinħeba l-frott tal-korruzzjoni.

Iddur kif iddur, il-politiku u dawk ta madwaru qatt ma jistgħu jiġġustifikaw il-ħolqien ta dawn il-kumpaniji. Għax dawn ġeneralment  ifissru involviment fil-korruzzjoni inkella fl-evażjoni tat-taxxa. Għalhekk il-polemika.

Tnejn mill-kumpaniji ilna nafu ta min huma. Ta Konrad Mizzi u ta Keith Schembri. Inkixfu kmieni u kien għadu ma sar l-ebda użu minnhom, skond kif kien intqal dakinnhar. Kienet inkixfet korrispondenza dwar il-possibilitá ta ftuħ ta kontijiet ma diversi banek. Kien hemm diversi tweġibiet kompromettenti li, iżda, Konrad Mizzi u Keith Schembri dejjem ċaħdu li kellhom xjaqsmu magħhom jew inkella li kienu inħarġu fuq struzzjoniiet tagħhom. Ftit kienu twemmnu.

Il-polemika baqgħet għaddejja u l-attenzjoni ċċaqalqet lejn it-tielet kumpanija : Egrant Inc. Ta min kienet din?

Niftakru li imkien fil-Panama Papers ma kien hemm l-iċken informazzjoni dwar is-sid jew is-sidien ta Egrant Inc, għax kien intqal li din l-informazzjoni kienet ser tgħaddi bil-fomm fuq Skype. Il-messaġġ kien ċar, mill-ewwel, li l-probabbiltá kbira kienet li kien hemm xi persuna jew persuni importanti ħafna involuti. Importanti iktar minn Konrad Mizzi u Keith Schembri, jiġifieri.  Ma kienx hemm lok għall-immaġinazzjoni. L-ismijiet possibli kienu limitati ħafna u l-ismijiet probabbli kienu fuq fomm kulħadd!  In-nies ilhom jitkellmu dwarhom!

Nhar il-Ħamis infetaħ kapitlu ieħor. Fuq il-blog tagħha Daphne Caruana Galizia irreferiet għall- dokumenti li skonta qegħdin fis-safe tal-Pilatus Bank u li minnhom jirriżulta li l-kumpanija Egrant Inc hi ta Michelle Muscat u li din il-kumpanija irċeviet diversi flejjes mill-Azerbajġan, l-ikbar waħda minnhom somma ta $1.017 miljun li waslet mingħand bint Aliyev. Mil-livell ta dettall ippubblikat hu ċar li d-dokumenti interni tal-bank huma s-sors tal-istorja. Il-Ġimgħa fil-għaxija ġiet ippubblikata informazzjoni dwar ċertifikat taisħma fliema ċertifikat qed jingħad li l-kumpaniji Dubro Limited S.A. u Aliator S.A. għandhom fidejhom ishma tal-kumpanija Egrant u dan fisem is-Sinjura Michelle Muscat. Imma d-dokumenti infushom li minnhom qed ikun ikkwotat sissa għadhom mhumiex ippubblikati. Ma nafx għaliex.  Hemm bżonn li jinħarġu għad-dawl tax-xemx id-dokumenti kollha li fuqhom hi ibbażata l-istorja. Dan hu neċessarju għax dak li qed jingħad hu ikkontestat.

Għalkemm din l-istorja ilha tinħass ġejja, xorta meta ġiet tinħass iebsa ħafna. Hi ta gravitá kbira u tista tkun dak li  jispjega l-għaliex Konrad Mizzi u Keith Schembri ma tkeċċewx is-sena l-oħra meta ħarġet l-aħbar li kellkom il-kumpaniji sigrieti.

TaPilatus caħdu kollox, bħalma għamlu tan-Nexia BT u ovvjament Joseph u Michelle Muscat.

Bosta huma konvinti mill-veraċitá tal-istorja. Imma li tkun moralment konvint li l-istorja hi korretta mhux biżżejjed. Din l-istorja teħtieġ il-konferma li tiġi mill-provi tad-dokumenti u mhux mid-dimostrazzjonijiet. Għax fuq id-dokumenti hi mibnija. Allura hemm obbligu li dawn id-dokumenti tant bażiċi jaraw id-dawl tax-xemx.

Ippubblikat fuq Illum : 23 t’April 2017

 

 

 

Spotlight on Pilatus Bank

 

The Egrant Inc. story has been in the news for the past year: it has been developing for over the four years since the 2013 general elections, when it was set up together with other companies.

First we had Konrad Mizzi with his company Hearnville Inc. Then we had Keith Schembri with his company, Tillgate Inc. The matter became public when the Panama Papers were disclosed. Millions of hitherto secret documents about companies set up by public and private individuals all around the globe were made public. 

The core of the issue is not the setting up of the companies but the objectives for which they were set up. Secret companies are normally set up for the concealment of financial and other assets in order to avoid the taxman or to conceal the fruits of corruption.

The owners of two of the companies are already known. One of them is Minister Konrad Mizzi while the other is the Prime Ministers Chief of Staff Keith Schembri. Their identity was disclosed over 12 months ago, when it was declared that their Panama companies had not yet been put to use. When the Panama Papers were published it became known that correspondence with several banks had been exchanged relative to the opening of bank accounts for the said companies. Requests and commitments were spotlighted but Konrad Mizzi and Keith Schembri disclaimed any association with this correspondence and commitments identified.  No one believed them then.

The polemic went on and the focus shifted towards the third company: Egrant Inc. Who was its ultimate beneficial owner?

We should remember that the Panama Papers did not shed any light on the identity of the owner or owners of Egrant Inc. because this information was never communicated in a written manner: it was communicated over Skype. The message conveyed was immediately clear that in all probability some big-head was involved and that he or she was more important than Konrad Mizzi or Keith Schembri.  There was no room for imagination as the possible names were limited in number with the actual names being on the tip of everyones tongue.

On Thursday, a new chapter was opened. Daphne Caruana Galizia, on her blog, referred to documents that she said were in the safe of Pilatus Bank. These documents identified Michelle Muscat as the ultimate beneficial owner of the company Egrant Inc. It was also stated that this company received money transfers from Azerbaijan, including the sum of $1.017 million on the instructions of the daughter of Azerbaijan’s President Ilham Aliyev.  

The level of detail described by Daphne Caruana Galizias blogpost indicates very clearly that this was based on the contents of bank documents. On Friday evening, additional information relating to a certificate of trust was published. This information, the validity of which was contested by Joseph Muscat, states that the company Dubro Limited S.A. and Aliator S.A.  hold shares in the company Egrant Inc. on behalf of Mrs Michelle Muscat.  But the documents from which this information is being extracted are still unpublished.  I do not know why this is so. It is necessary that these documents, fundamental to the issue under consideration, see the light of day. This is essential because the information published is being contested.  

The information published is serious stuff. It may be the reason why Konrad Mizzi and Keith Schembri were not dismissed from office last year when the Panama Papers were published.

Pilatus Bank, Nexia BT, Joseph and Michelle Muscat have denied the published information.  Many are  convinced on the veracity of the story, but being morally convinced is not sufficient. Proof only results from authentic documentation but certainly not from demonstrations. It is for this reason that the full disclosure of all the documentation on which the published information is based is an essential  prerequisite.

published in The Malta Independent on Sunday – 23 April 2017