Busuttil calls for rethink on business accounts opt-out

Nationalist MEP Simon Busuttil has criticised the government's decision to opt out of a new pro-business EU directive and demanded a rethink.

"I cannot believe that the government is considering depriving our smallest businesses from the advantage of saving hundreds of euros each year in costs incurred on their annual accounts," Dr Busuttil said after a vote in the European Parliament on a directive on micro businesses.

The Parliament approved an amendment that exempts such small firms from the requirement of submitting their accounts every year. The measure is expected to lead to annual savings of over €1,500 for those eligible.

However, the choice of whether to grant the exemption has been left to individual member states and Malta has declared it does not intend to grant it.

Earlier this month, a spokesman for the government said that, while it agreed with the aim of the directive, the exemption "could negatively affect the country's tax base" as an important audit trail would be lost.

"I do not buy the argument," said Dr Busuttil. "There are other audit trails that can be followed without depriving micro businesses of this advantage.

"Moreover, our businesses would be worse off than their counterparts in Europe, which would now have lower costs to shoulder as a result of these savings. I hope that the government will reconsider its position in the interest of our micro businesses."

The proposed directive, still being discussed at Council level, forms part of the EU's drive to cut red tape for small businesses.

The exemption from having to draw up annual accounts applies to companies whose balance sheet total is under €500,000, those with a net turnover of under €1 million and/or with an average of 10 employees during the financial year. This encompasses the majority of Malta's firms.