MP says Muscat like Nero, watching as Malta ‘burns into reputational oblivion’

Finance minister Edward Scicluna accuses Opposition of using Panama Papers revelations to tarnish reputation of Malta's financial services sector overseas

Opposition MP Kristy Debono lashed out at the Prime Minister for his handling of the ‘Panama Papers’ scandal, likening him to the Roman Emperor Nero who had watched on as Rome burned.

“In other countries, the Panama Papers leak led to impeachments, asset freezing, police investigations, magisterial resignations, and resignations,” Debono said in a parliamentary speech on a financial services Bill. “However, in Malta, the person involved [energy minister Konrad Mizzi] was actually promoted [to PL deputy leader].

“It is a paradox that makes me wonder whether Malta is still a living democracy or whether it is nearing ever closer to democracy’s deathbed.”

She said that Malta’s reputation as a financial services destination has been dealt a hammer-blow following the revelations that Mizzi and OPM chief of staff Keith Schembri own offshore companies in Panama.

“Through its failure to take action, the government has exposed Malta’s financial services sector to greater reputational risks than it has ever faced before, and it did so consciously. The government must take concrete damage control actions before it is too late.”

“Muscat has gone from boasting about how he always takes the necessary action to resembling the Emperor Nero, watching on as Rome burns. Muscat knows what he has to do, and he knows that he will cause more damage the longer he delays.”

Indeed, she claimed that Malta’s reputation has changed overnight from an investment and safe haven to a tax haven.

“It takes 20 years to build a reputation and five minutes to ruin it,” she said, quoting US entrepreneur Warren Buffet.

She added that an Opposition motion of no confidence in the government – that will be discussed on Monday - is an opportunity to safeguard Malta’s reputation in financial services.

“Every day that passes in which Muscat fails to take action is nothing but a lost opportunity to save the country from oblivion,” she said. “What is stopping the government from taking action now? It will weaken Malta’s hand in proving that it is not a high-risk tax jurisdiction.

“It is truly unjust that the employees in the financial services sector are now paying the price for Muscat’s nonchalance.”

‘Opposition trying to stain Malta’s reputation overseas’

Finance minister Edward Scicluna accused the Opposition of trying to tarnish Malta’s reputation as a safe tax jurisdiction overseas.

“The Opposition is right to criticise but it shouldn’t try and smear all the Cabinet ministers and the entire financial services sector,” he said, noting the PN youths’ recent letter to EPP president Martin Schulz that Malta is facing a political crisis. “How can the Opposition defend Malta’s financial services sector on the one hand and stain its reputation overseas on the other?”

He vehemently denied that Malta is a tax haven, arguing that it no longer has a system of financial secrecy and that it forbids money laundering.

“Other European countries might use the Panama Papers to push for tax harmonization, but Malta believes in its tax regime. We stand firm against tax evasion and aggressive tax avoidance – such as by multinationals such as Google and Starbucks – but we mustn’t throw out the baby with the bathwater and harm our competitiveness. Malta doesn’t have the natural resources other European countries have, and shouldn’t be forbidden from offer lower taxes so as to attract companies to the country.”

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