Prime Minister Robert Abela has said Malta will block any attempt to introduce EU-wide taxes to fund the European Union’s central budget, as discussions begin on the bloc’s next long-term financial framework.
Addressing parliament, Abela reaffirmed Malta’s opposition to new EU-level taxation and stressed that the government would use its veto if necessary.
The issue emerged during discussions at last week’s European Council summit in Brussels, where member states began outlining their positions ahead of negotiations on the EU’s next multi-year budget.
Among the ideas being discussed at European level is a levy on gambling, a proposal that could have major implications for Malta’s economy.
The online gaming industry contributes more than 10% of Malta’s GDP and remains one of the country’s most significant economic sectors.
Abela also confirmed Malta’s continued participation in the Friends of Cohesion group, a coalition of EU countries coordinating their positions ahead of formal budget talks.
The Prime Minister’s stance has drawn criticism from tax justice campaigners, who argue Malta benefits from one of Europe’s most attractive corporate tax systems.
Organisations such as the Tax Justice Network have repeatedly criticised Malta’s tax refund mechanism, which can significantly reduce the effective tax paid by foreign-owned companies operating from the island.
According to figures cited by campaigners, companies that would have been expected to pay around €1.5 billion in tax in 2022 ultimately paid just €216.6 million after refunds were issued.
Despite those criticisms, the Opposition broadly backed the government’s position.
PN deputy leader Alex Perici Calascione called for Malta to adopt an even stronger stance during negotiations, while also stressing the importance of ensuring Gozo’s interests are protected in any future EU funding arrangements.
Any changes to EU tax rules require unanimous approval from all 27 member states, meaning Malta retains the power to block proposals it opposes.
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Gabriel Falzon is a social media executive at Lovin Malta, with a keen interest in digital media, local businesses, and the natural world. Outside of work, you’ll often find him baking up a storm, diving into video games, or exploring the endless corners of YouTube.
