Malta wants to get rid of ‘its ugly reputation’
Malta wants to get rid of its ugly reputation, reported Markus Mayr and Frederik Obermaier on the Suddeutsche Zeitung reporting on the conference given by Finance Minister Edward Scicluna in Berlin on Tuesday
In the Maltese embassy on the third floor of a building south of Berlin's Tiergarten park, almost in the shadow of the park trees, Scicluna tried to free his country from the stigma of the shadow financial centre. "What you see is what you get," said Scicluna. "We have nothing to hide."
The Maltese tax system had been recognized by the European Union when Malta joined in 2004. For a long time, the country has been a tax oasis, the paper said.
The ruling Labour Party and the Nationalists come together on the subject of taxes. The paper added however that tax evaders, who seek low levies and great secrecy in Malta, are an important economic activity.
But it has been rumbling on the island for several months. Since the publication of the Panama Papers last year, the Maltese are discussing the offshore implications of their politicians. New details keep coming to light - there is the suspicion in the room, that several party colleagues of Scicluna cash on a large scale bribe.
In January the Greens in the European Parliament branded Malta as a tax haven. And in February, SZ and WDR reported that many Germans had apparently concealed their Maltese companies from the German authorities.
Finance Minister Scicluna strongly argued: "Certain persons" from Germany would harm Malta's reputation.”
Last week the North Rhine-Westphalia Minister of Finance Norbert Walter-Borjans announced that his taxpayers had got hold of explosive data: data on mailbox companies in Malta. Minister Scicluna accused Walter-Borjans of spreading false information. Walter-Borjans shot back verbally, the media reported worldwide. Suddenly, light fell on Malta's shadowy financial centre.
Malta will now face a general election. In addition, the country holds the EU Council Presidency. Headlines on the "Tax-easy Malta" are not doing well to the country. Hence the offensive launched by the Maltese Minister of Finance with his embassy appearance.
Flanked by two representatives of the Maltese Financial Supervisory Authority, Scicluna explained that everything in Malta is right.
"If the German tax authorities ask us for information about German holdings in Maltese companies, we will pass them on," he said.
The German authorities apparently simply failed to ask their Maltese colleagues for a list of companies with German participation - a list that even journalists get for a few euros. In addition, the presidency of the Council was intended to put some effort into the process: the automatic exchange of tax data should become effective in 2017.
Malta is a great opportunity to save money with legal business start-ups. For example, corporation tax can be reduced to less than ten percent by means of a Maltese subsidiary. According to a computation, the German states lose up to four billion euros annually.
Numerous German corporations also seem to use Malta's incentives, such as the chemicals group BASF, the car rental company Sixt or the airport operator Fraport. Some of these companies have branches in Malta with dozens of employees. Others just have a mailbox. Employees who could answer questions? None.