Taxation should be a tool to help small businesses and start-ups to grow − Prime Minister Muscat

Prime Minister Joseph Muscat said that the taxation system should be a means to help small businesses and start-ups to grow rather than stifle them. He said that innovation is filtering to every segment of the financial and business world and that the industry needs to adopt with the same pace.

The Prime Minister was speaking at the Malta Institute of Accountants Biennial Conference, entitled The Finance (R)evolution… Unlocking the digital riddle.

Prime Minister Muscat said that the financial industry in general is already experiencing the strong transformative force of digitisation. “Where it will lead us is not clear-cut yet. But one thing is certain: digitalisation and new financial technologies will play a major role in further integrating financial markets and cross-border business,” said the Prime Minister.

Dr Muscat said that the digital revolution will not stop and government is choosing to be bold and take the first steps towards success rather than simply drift away.

“We are only at the start of the journey. Many professionals are just starting to appreciate the benefit of emerging and disruptive digital technologies. The effects of a digitalised and connected world is much more that a change in processes. It is about new business models, about a new approach to do things, a new way to think,” said the Prime Minister.

The biennial conference was also addressed by the parliamentary secretary for Financial Services, Digital Economy and Innovation Silvio Schembri who emphasised on not taking for granted the full magnitude of these changes, hence why government took a proac- tive stance by anticipating, enabling and embracing disruptive technologies. Schembri said that professional accountants, accounting practices, procedure and processes will need to adapt, thus education and training of professions should be modified accordingly.

“Technology can serve as a tool for accountants to contribute in developing holistic financial solutions. The recurring mindset is that technology will lead to job losses − this only happens when one doesn’t adapt, resulting in, as the saying goes ‘technology will end up chasing you’,” said Schembri.

Schembri added that financial services professionals in the digital age need to be agile, flexible and should strengthen their skills. The coming years may see the adoption of new methods usually used by the accounting profession being carried out by artificial intelligence and autorotation systems, consequently, the demand for talent will increase.

“We will witness the fusion of professions and not the elimination of professions, for instance, in accountancy we shall observe the rise of accountant engineers and in other instances financial engineers or even law engineers,” Schembri said, adding that in view of this, a scholarship fund was launched between Mita and the University of Malta to encourage law, finance, engineering and management students to pursue their studies in DLT at Masters and Doctorate levels.

Schembri encouraged educational institutions to adapt and train future generations of accountants against the exciting backdrop of the digital age while appealing to companies to invest further in human skills and their workforce.