The government has replied to questions from the European Commission over some of Malta’s tax practices.

However, it cannot divulge information about the issues at this stage, a Finance Ministry spokesman said.

Times of Malta last week revealed the country has been put in the spotlight over some of its decisions concerning tax rulings, particularly those involving private multinationals who might have companies or subsidiaries registered in Malta.

The ministry yesterday confirmed it had been asked questions by Brussels, saying the information requested had already been delivered.

“We confirm that we received a questionnaire on tax rulings to which we provided the required answers and information,” the spokesman said.

It is not opportune to give additional information

Asked for further information, he added: “Since the matter is still under review, it is not opportune to provide additional information.”

The Commission’s request for information was sent to Malta and a number of other member states including Cyprus and Belgium.

It followed the start of formal investigations into Luxembourg, the Netherlands and the UK over suspicions they may be giving some multinationals special treatment for tax purposes, namely firms belonging to Apple, Starbucks and Microsoft.

For Malta, the Commission made it clear that it is only seeking explanations about certain decisions. Commission sources said this was necessary in the light of the EU’s fight against tax evasion.

While it is a known secret that many multinationals try to use different systems to minimise the taxes on their profits, many EU member states, including Malta, try to use their taxation systems to lure big companies to operate in their jurisdiction.

This is normally done through various incentives, including tax, which are legitimate under EU laws.

While competition in taxation is allowed under EU rules, selective treatment of certain companies is not.

The European Commission wants to ensure that there is a level playing field across the bloc.