MEP raises taxation issues with EU Commissioner

The departure tax increase for Maltese and Gozitans travelling to other countries and the tax on mobile telephony will be re-examined in detail by the European Commission, which will also present its first draft of a new directive on vehicle registration tax.

EU Taxation Commissioner Laszlo Kovacs made these commitments following a meeting with Labour MEP Joseph Muscat during a meeting of the European Parliament's economic and monetary affairs committee.

In a presentation, Mr Muscat said that while taxation policy remains the competence of member states, certain taxes being imposed hindered important principles like the freedom of movement. He said that as of August the Maltese government would be doubling the departure tax from Lm10 to Lm20 for residents in Malta, which meant that a resident would have to pay more than Lm34 in taxes, airport charges and fuel surcharges, and excluding taxes and other charges imposed by the destination country.

"These amounts are simply unacceptable, especially in the case of an island like Malta where air links are the most - if not the only - effective contact with the rest of the world," he said.

Mr Kovacs said he understood Mr Muscat's point and pledged to re-examine the issue. He made the same promise with regard to taxes being imposed on mobile telephony.

The commissioner also announced that the first draft of a new directive changing the vehicle registration tax regime would be ready by the end of this month. He agreed with Mr Muscat that it was unacceptable for a person to buy a car in a member state and pay the registration tax accordingly for him to be asked to repay if the car is taken to another member state.

The new draft directive will propose the scrapping of such double payments, the taking into consideration of the vehicle's actual value and that member states would be discouraged from charging excessively high payments.