Country helped multinationals avoid paying more than £12bn in taxes from 2012 to 2015, says report from Green MEPs. Malta has been accused of being a tax haven, just as it takes the helm of the European Union in a critical year for the bloc’s crackdown on tax avoidance.
The EU’s smallest member state helped multinationals avoid paying €14bn (£12.1bn) in taxes between 2012 and 2015 that would have gone to other countries, according to a report commissioned by Green MEPs in the European parliament.
Malta could be deemed a tax haven according to EU’s own criteria, concludes the report, which was written by accountancy lecturer Tommaso Faccio of Nottingham University Business School.
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The Maltese prime minister, Joseph Muscat, faced calls to resign last year, after the leaked Panama papers showed two of his allies had offshore accounts, including health and energy minister Konrad Mizzi.
Malta, which has a population of 430,000, took over the EU’s rotating presidency on 1 January. During its six months at the helm, EU finance ministers will discuss legal proposals that would require large multinationals operating in Europe to disclose profits earned and taxes paid – “country by country” reporting that has long been demanded by transparency campaigners. The EU’s 28 countries will also attempt to advance work on a list of tax havens, promised by the end of the year.
Tax campaigners are questioning whether Malta has the political will to push this agenda, pointing out that the government does not mention tax in its presidency priorities.
Sven Gielgold, a German Green MEP who campaigns on taxation, told the Guardian the study showed Malta was a tax haven, according to EU criteria. “The tax system in Malta is generous to say the least, with large companies routinely paying as little as 5% tax on their profits. This is completely unacceptable and raises serious questions.”
