Finance Minister Tonio Fenech this morning reiterated the government's concerns about the European Commission's proposals for a common consolidated corporate tax base.

This was a way of converging European taxation and pooling revenue.

However, a European Council proposal, which Malta was not against, was for a common corporate tax base which was not consolidated. This would mean that there would be harmonisation across the EU as to what constituted revenue and how to gauge it but states would be allowed to set their own tax rates.

Mr Fenech said the government had major concerns about the matter and it was clear that Malta would be among the losers if the Commission's proposal was adopted.

For the proposal as it stood, he said, rewarded inefficiency and punished countries such as Malta which tried to overcome their inerrant disadvantages through a variety of tax inentives.

The minister was speaking during the presentation of an impact assessment report commissioned by the Malta Business Bureau and carried out by PriceWaterhouseCoopers, looking into the impact of the Commission's proposal on Maltese businessed.

The report, which is not being made public due the nature of the individual data enclosed, concludes that the proposed directive would be detrimental to Malta's economy and called on the government to take a strong position against it.

Malta Business Bureau outgoing president John Huber said companies response was proportionally better than in other member states.

The proposed system, he said, was the last among many attempts to converge taxation at a European level.

Although Malta was doing relatively well during these turbulent times, he encouraged the government to be cautious and keep fighting for Malta's position.