Category: Archive – 2011

Double taxation, and double non-taxation, contradict the very spirit of the Single Market. Yet many citizens and businesses are still suffering heavier tax burdens just because they operate in more than one Member State. Meanwhile, others are using loopholes between national systems to escape paying taxes that they owe. Determined to tackle this problem, the Commission adopted a Communication on Double Taxation.

 

 

 

This Communication highlights where the main double taxation problems lie within the EU, and outlines concrete measures that the Commission will take to address them. In doing so, the Commission seeks to remove real obstacles to a more competitive economy and make the EU easier to invest and do business in.

Algirdas Šemeta, Commissioner for Taxation, Customs, Anti-Fraud and Audit, said: "We must be able to send the message to all citizens, businesses and trading partners: the EU does not tax twice! Double taxation is one of the biggest tax obstacles to the Internal Market, and can no longer be overlooked. Today I have presented clear and feasible ways to tackle double taxation, which will make the EU a more attractive place to live and work in."

A public consultation carried out by the Commission found that more than 20% of reported cases of double taxation of businesses were worth over €1 million, while for individuals, more than 35% of double taxation cases were worth more than €100 000.

Background

Currently under EU law, there is nothing to oblige Member States to prevent non-discriminatory double taxation. Although Member States try to relieve double taxation through measures such as bilateral and multilateral double taxation conventions, these do not provide adequate protection for citizens and businesses due to various shortcomings (e.g. too narrow scope, lack of uniformity amongst Member States' provisions, administrative burdens, long time-lines for dispute resolution etc.). The 2010 Citizenship report highlights the inadequacy of existing mechanisms to avoid double taxation in the EU. The problem of double taxation therefore continues to create barriers to cross-border establishment, activity and investment in the EU.

Clearly, given its cross-border nature, further action at EU-level is needed to fully and effectively address this problem. Over the past year, the Commission has already made headway in tackling double taxation in specific areas e.g. the proposal for a Common Consolidated Corporate Tax Base.  Today's Communication launches the next phase of work to try to bring an end to the problem of double taxation, for the benefit of both citizens and businesses across Europe. 

Next steps

As an immediate first step to strengthen existing legislation against double taxation, the Commission also adopted today a simultaneous proposal to improve the Interest and Royalties Directive. This aims to reduce the instances of one Member State levying a withholding tax on a payment, while another Member State taxes the same payment. Other areas in which the Commission intends to propose specific solutions to double taxation problems include cross-border inheritance tax in the near future and dividends paid to portfolio investors later on.

The Commission will also work on other possibilities to help eliminate cross-border double taxation, such as creating an EU Forum to develop a code of conduct on double taxation and a binding dispute resolution procedure for unresolved double taxation cases.

With regard to double non-taxation, which causes considerable losses to public revenues, the Commission will launch a consultation to gauge the full scale of the problem. On the basis of this consultation, it will determine the most appropriate and effective measures to prevent double non-taxation and come forward with solutions next year.

The Commission will submit the Communication on Double Taxation to the European Parliament, Council and European Economic and Social Committee for discussion and the Interest and Royalty Directive proposal to Council and the European Parliament.

GRTU's Director General Vincent Farrugia as member of the EESC has been appointed as Rapporteur on behalf of the EESC to draft an opinion on the subject. Which opinion, once approved, will be taken into consideration by the Commission before issuing the law.

The European Union Programmes Agency (EUPA) shall be holding a series of information meetings to provide an overview of the open calls for 2012 and to give specific guidelines on how to apply. These shall be on:

Monday 5th December – Leonardo da Vinci Mobility and Transfer of Innovation;

Tuesday 6th December – Small Scale Cooperation (Comenius Partnerships, Leonardo da Vinci Partnerships, Grundtvig Partnerships, and Grundtvig Senior Volunteering Projects);

Wednesday 7th December – Individual Mobility (Comenius In-Service Training, Grundtvig In-Service Training, Grundtvig Visits and Exchanges, and Grundtvig Learning Workshops).

Maurice de Marco Hall at EUPA premises, 36, Old Mint Street, Valletta between 10am and noon.

Interested persons can register by sending their contact details i.e. name and surname, name of institution they represent and the action they are interested in .

More information with regards to the Lifelong Learning Programme Call for 2012, including closing dates, official documentation and guides for applicants, can be found on the website www.llp.eupa.org.mt.

These initiatives are funded with the support of the European Commission (Directorate General Education and Culture).

Why did you become an entrepreneur? I became an entrepreneur because my family has been entrepreneurs for generations. Another reason is that I have a problem with  working for people. I always believe that the creation of value by running a business is not just beneficial to myself, but to the families of employees and ultimately the country.

 

How have you come to chose your line of business?

I failed as a medical student. So I did the next best thing. I chose the medical business because it's a fascinating business. The building side of the business is however in the blood!

Where did you go on your last holiday?

Paris. It's such a fantastic city. But nothing beats London. It's a city for everyone. I feel so alive there.

What is your earliest memory?

My earliest memory is going with my father to our quarry for the first time, and being fascinated by the machinery.

If you could chose to be someone famous who would you be?

I would like to have been a combination of the artistic Picasso and the creative innovation of Steve Jobs !

A new online portal to help young entrepreneurs start and grow their own business was launched on 17 November by the Employers' Group of the European Economic and Social Committee (EESC), in which GRTU's Director General is member representing employers.

 

The website is a joint initiative of the EESC and the European Commission. It addresses policy failings in the promotion of entrepreneurship, especially among young people and women. The Global Entrepreneur Envoy online portal "Entrepreneur Envoy" will offer tools to foster culture change and promote entrepreneur-friendly policies. The launch took place on 17 November 2011 during the third edition of the "Young European Entrepreneurs' Seminar", hosted by the president of the Employers' Group of the EESC, Henri Malosse. The event featured contributions from 52 active young entrepreneurs from 18 European countries.

Mr Malosse said: "We want to develop a new vision of the entrepreneurial spirit, allowing Europeans to create wealth and build on a European identity. I truly believe in the power of water droplets accumulating to achieve great things. We can achieve anything if we pool our modest means."

The participants' recommendations the following priorities:

 A European Statute for SMEs (the Statute for a European private company), an EESC initiative

 A unified Europe with a real European government

 Facilitating vocational exchange for young people, in addition to school and university exchange schemes

 A European network of business incubators

 European financing facilities for new initiatives, especially microcredit

 Holding a "Young entrepreneurs' day" to celebrate success

For more information, please contact Milen Minchev by sending an email to:

The Employers' Group is one of the three groups of the European Economic and Social Committee (EESC), a consultative body of the European Union. The EESC enables representatives of business organisations, trade unions, professional associations and civic groups to contribute to the framing of EU policies and decisions."

The European Commission has launched a major Action Programme for reducing administrative burdens (2007-2012). This programme focuses on the information that EU businesses are obliged to provide to public authorities or private parties: information required for legal registration, certification, inspection, subsidy; filing statistical forms; energy labels for consumers or reports to stockholders; etc.

 

The consultation invites entrepreneurs to identify unnecessary red tape in order to help the EU improve the quality of its legislation. The consultation is part of the Action Programme to reduce admin burdens on businesses in the EU by 25% in 2012.

If you feel that you are obliged to provide unnecessary information or that the required information could be provided in a more efficient way, please use this form to submit your suggestions. If you have problems with several pieces of legislation, use preferably a separate form for each piece of legislation.

To access this consultation, please click here:

http://ec.europa.eu/enterprise/policies/smart-regulation/administrative-burdens/online-consultation/submit-an-idea/index_en.htm

The consultation is very short and contains targeted questions. Each suggestion will be examined by the Commission and every three months the Commission will prepare a summary of these suggestions and an overall feedback on the same site.

Questions and comments on this consultation should be sent to:

Il-GRTU flimkien mall-Kummunita' Kummercjali Naxxarija taghti support shih lill-din l-attivita'. Ghat-tielet sena konsekuttiva l-Kunsill Lokali tan-Naxxar qieghed jorganizza attivita' tal-Milied li l-inawgurazzjoni taghha ser ssir l-Hadd 4 ta' Dicembru 2011. Il-programm ser jigbor fih numru ta' attivitajiet fosthom kant, mmudellar,attivitajiet ghat-tfal bil-partecipazzjoni ta' Santa Clause, diversi bands, kantanti popolari lokali flimkien ma artisti stabbiliti, trackless train u hafna attivitajiet ohra.  

 

Wiehed jrid jifhem li l-preparamenti u l-attivita'  fiha nnifisha joholqu xi ftit tal-inkonvinjenza. Sabiex  jitneħħa kull dubju u tkun iccarata s-sitwazzjoni, wara li kien hemm min ressaq xi ilmenti, nixtieq ninfurmakom li l-Kunsill ser jkun qed jagħmel dak kollu possibli biex inaqqas l-inkonvenjent u/jew xi impatti negattivi li l-preparamenti għall-attività ta' nhar il-Ħadd 4 ta' Dicembru jista' jkollha fuq in-negozju.

Certament li l-għan ewlieni għal x'hiex isiru attivitajiet bħal dawn huma biex jiżidied n-negozju lokali u għalhekk tistgħu isserħu raskom mir-rieda tajba tal-Kunsill li ser jnaqqas kemm jista jkun kull impatt negattiv possibbli. Din id-darba gie mnaqqas l-estent tal-attività biex inkomplu nillimitaw aktar filwaqt li t-traffiku jibqa' jasal sa' aktar vicin tal-attività milli s-soltu jsir. Madanakollu, kif sar dejjem, se tigi llimitata r-restrizzjoni għall-inqas possibli.   

Li se jsir għalhekk huwa dan:  il-Gimgħa 2 ta' Dicembru se jingiebu l-istalls u jkunu armati fin-naħa tat-terminus.  La darba jkunu armati se jitpoggew fi gruppi f'postijiet strategici fejn l-inqas ikun hemm cans li jtellfu l-parkegg.  Jista' jkun li jitpoggew anki fuq bankini minflok fit-triq b'mod li ma jtellfux il-passagg. 

Is-Sibt filgħodu jibda jsir certu armar fuq il-bankini fejn meħtieg filwaqt li t-tpoggija tal-istalls fil-post jibda kmieni wara nofsinhar. 

Il-Ħadd filgħodu jkompli l-armar u jrid ikun hemm il-postijiet kollha indikati fuq il-lista bla parkegg.  Mal-10am se jkun ristrett it-traffiku b'eccezzjonijiet għar-residenti.  It-trasport pubbliku jitħalla għaddej sas-2pm.  Mis-2pm se jkun hemm għeluq totali u jibdew l-attivitajiet.

Il-GRTU tifrah lill-Kunsill u f'isem il-komunita' Kummercjali Naxxarija tawgura li din l-attivita' tkun ta' success bhas snin precedenti.

Last Tuesday GRTU officials met with officials of the Ministry for Infrastructure Transport and Communication following meetings the GRTU held with Valletta retailers. GRTU told the Ministry that the positive but ambitious projects being undertaken within our Capital City have resulted in a serious drop in the sales and turnover of retailers. We cannot hope for the inconvenience to be over soon as the issue is not a seasonal one and the GRTU is seriously worried of the state and the future of the retailers in Valletta. GRTU is therefore trying to find ways to stop the negative trend.

The GRTU therefore proposed for the CVA rules to be adjusted for the upcoming festive season as we believe this is a measure that would help to boost sales. On behalf of its members the GRTU asked the Ministry to waive the CVA charges after 15.30hrs. The Ministry accepted GRTU's proposal and made the announcement public earlier this week.

The GRTU together with the retailers in Valletta will be working on further initiatives that will encourage and attract more locals and tourists to enter Valletta. These initiatives aim at encouraging them to spend more time in the Capital City and the issue of access to Valletta will be dealt with as first priority. The Ministry also said it will support the GRTU in this regard.

GRTU participated today to the European Parliament Citizens Forum organised by the European Parliament Office in Malta. GRTU Director General Vincent Farrugia stated that the choice that the European citizens are presented with, by a large section in the media, especially British media, " most unfortunately the choice is between doom and gloom as a future for Europe" stated Vincent Farrugia.

 

The situation in reality is not as negative as it seems. The answer is gloom only when the problem is not well analysed and a solutions is not available. In the current state of Europe the problem has been analysed and is one of sufficient confidence that motivates markets to buy the sovereign debts of European Governments especially those with macro-economic imbalances, both internal "budget deficits" and external imbalances "economic deficit in the rest of the world". The solution is also identified as the need to provide the money necessary to ensure that all the bonds needed to ensure a return to normality is made available. The practical tools have also been identified.

The euro bond is one obvious solution, but there are other solutions, all more or less a different version of the same. The choice is of tools that will move the funds that are excessive in some countries in Europe and in the rest of the world to those economic areas where the money is most needed. When a problem is analysed and solution is available and the tools to implement the solution are the subject of discussion, then doom should not be a problem.

EU leaders are committed to find the right tools to implement the most practical of solutions. The alternative of the solution being discussed is the breakdown of the monetary union, which should be followed by the breakdown of the economic union. The cost of the breakdown is so excessively large compared to the corrective solutions available that it is obvious that EU leaders will decide in favour of the corrective solutions, as they have committed themselves to do and as they have shown in the implementation of the pro-economic and monetary solutions .

"In my view the predictions of doom and gloom are exaggerated and will not materialise. What is more relevant for us in Malta, and really worth discussing, is the cost of our economy as alternative solutions that are being proposed at EU level" concluded Vincent Farrugia, GRTU's Director General.

Whatever anybody else says, Government's decision to pay from public funds the additional 4 weeks maternity leave to self-employed women is solely due to GRTU. The Prime Minister, Minister for Finance, the Economy and Investment, the Minister for Education, Employment and the Family, the Parliamentary Secretary for Small Businesses and Lands and the Parliamentary Secretary for Consumer, Fair Competition, Local Councils and Public Dialogue know perfectly well and can confirm who lobbied and negotiated hard to ensure that self-employed women are given their rights and the payments due under the new maternity leave regulations.

 

It was under the initiative of GRTU, under professionally presented arguments, that convinced the cabinet of Ministers to include self-employed women under the category of women entitled for the 4 weeks standard pay once the maternity leave effective under Maltese law is extended to 18weeks.

Others may draw shopping lists and express wishful thinking before each year's budget. GRTU draws the strategy within the framework of Government's financial and fiscal constraints, lists its priority projects, calculates and estimates the financial, economic and social impact of its proposals, and bargains hard to obtain what it justly aspires for. That is why GRTU never stands in front of the media and declares something like "we proposed a lot but Government accepted nothing". We rightly say as we already said, once the implications of budget 2012 are unfolding, that we proposed substantial schemes and Government accepted many of our proposals.

GRTU once again thanks the Government high ranking officials for their cooperation and for having welcomed GRTU's claim. The GRTU also again congratulated all self employed women on this important win of the recognition of their rights.