Just 0.1% to save Europe

Isn’t it strange that while we accept that we need to have our incomes taxed to up to 35 per cent, with another 10 per cent sliced off in social security, we get people being duped into screaming blue murder about a financial transaction tax? Isn’t it strange that while the government pumped up the VAT rate from 15 per cent to 18 per cent “to help pay for the public health system” we have Malta joining forces with the perpetual nay-sayers, the UK, in refusing even to discuss a financial transaction tax?

A financial transaction tax can relieve some of the pressure on people’s wages and help reduce the proportion of tax which each EU country must pass on to Brussels. It is also a fairer way of raising revenue for social and ecological investment. It is only intended to tax speculative financial transactions, those same financial instruments which helped ruin the economy, led to job losses and meant that governments, including the Maltese government, had to fork out tax money to help companies and industry weather the storm.

All this fuss is about a tax of between 0.01 per cent and 0.1 per cent on those who have the luxury of playing around with money, betting on the short term while risking the long term. Certain quarters are trying to scare people, who pay a big chunk out of their income in taxes to help pay for a social safety net, that such a meagre tax on those who can afford to play Russian roulette with markets, will bring ruin to one and all. EU Commission President Barroso’s statement in his annual State of the Union address to the European Parliament says it all: “In the last three years, member states – I should say taxpayers – have granted aid and provided guarantees of €4.6 trillion to the financial sector. It is time for the financial sector to make a contribution back to society”.

As usual in Malta, both Lawrence Gonzi and Joseph Muscat are supporting financial speculation. We have a socialist who says he will reduce the burden of utility bills but at the same time refuses to support a fair and reasonable revenue-generating mechanism which would reduce Malta’s financial contribution to EU coffers.