It is pretty clear the Greens in Malta are acting on some instructions, or directives(?), communicated to them by their overseas controlling body (head office!) to propagate the incorrectness that “an overseas company in Malta only pays five per cent in income tax while a Maltese company or SME pays 35 per cent”.

The Greens local leader, Arnold Cassola, even tried to sell this notion off to the floor at the recent excellent Mcast conference on vocational and professional education and training.

He and his Greens badly need to become much more familiar with the practical functioning mechanics of Malta’s imputed tax system. When a local branch, subsidiary or associate, as partof an international group, ends up paying five per cent tax here this does not mean the parent company or the group as a whole, in accordance with international financial reporting standards for groups and in accordance with fiscal systems covering tax world incomes/profits (sometimes even turnovers), end up paying only five per cent tax in Malta. They pay differing higher rates elsewhere on their total group income.

If the Greens continue to deny to countries the possibility of offering differentiating tax efficiency mechanisms then they are, by implication, also denying the possibility to countries to engage in competitive mechanisms for attracting FDI. It is as simple as that.

To be totally fair to Cassola, he was trying to support his more than justified plea that employers who provide internships, apprenticeships and other work placements or experience opportunities to students should not use such mechanisms as ruses for exploiting such students and obtaining temporary cheap labour. It’s just that he chose a totally incorrect technical (or purely political?) argument and a totally incorrect forum to back up his otherwise correct stance in favour of students.