Prime Minister Lawrence Gonzi reiterated today that Malta is not in favour of an EU fiscal union.

Speaking in Parliament, he said that in his meetings with the eurozone leaders who were present in Malta for the 5+5 meeting, he had insisted that Malta could not back the proposed fiscal union since it would deny the country the sovereignty it enjoyed in taxation and other matters which were important for its competitiveness.

Replying to Opposition questions after giving a statement on the 5+5 meeting and the meeting of some eurozone leaders held on its fringes, Dr Gonzi said Malta was prepared to discuss other ideas and proposals with an open mind, as long as they did not mean fiscal union.

He said it was too early to comment on the proposed banking union since details had not emerged.

However Malta agreed about having single banking supervision because the absence of such supervision was one of the reasons for the current financial turmoil.

Malta, he said, remained against the Financial Transactions Tax as originally proposed. The original concept was for a tax on every financial transaction, something which Malta objected to.

Some countries were now discussing enhanced cooperation – moving forward on their own - something which Malta did not object to.

However the latest proposal in this context was the introduction of a stamp duty. Malta already had a stamp duty, Dr Gonzi said, and it was prepared to discuss this concept, but it remained against a financial transactions tax.

On the EU Budget he said Malta was continuing to insist on its eligibility for Objective 1 status – the maximum rate of assistance. If Malta exceeded the threshold of eligibility, Malta would still insist on eligibility through its status as a small island nation.