Issue link: https://maltatoday.uberflip.com/i/609762
TIM DIACONO NEW European initiatives could threaten Malta's sovereignty over its own fiscal affairs, KPMG part- ner Juanita Bencini warned. "There are dark clouds on the horizon and a closer European union may not necessarily be good for us," she said, referring to the European Common Consolidated Corporate Tax Base proposal that would require EU member states to develop a common set of rules to determine the tax base of com- panies with operations in multi- ple European countries. "We cannot allow large coun- tries to run roughshod over Malta in the name of tax transparency," she told a KPMG conference. "Tax transparency shouldn't dictate what countries' tax rates should be or what their taxation system should look like." In order to attract foreign com- panies to set up subsidiaries here, Malta offers an incredibly advan- tageous refund on shareholder dividends – profits that they would have made in other EU countries. While the statutory corporate tax rate for corporations is 35%, shareholders can take advantage of tax rebates when the com- pany's taxed profits are distrib- uted among them. This rebate on their dividends reaches as high as six-sevenths of the tax paid by the company, effectively reduc- ing shareholders' tax burdens to 0%-5%. However, the amount of money lost to EU member states through corporate tax avoidance each year is estimated at €1.1 trillion, and European Commission president Jean-Claude Juncker has pledged to clamp down on the practice. Last week, the European Parlia- ment overwhelmingly voted in favour of recommendations by a special tax committee to tackle corporate tax avoidance – that in- clude the establishment of a com- mon European corporate tax base that would streamline the way companies calculate profits. WWW.MALTATODAY.COM.MT WEDNESDAY EDITION WEDNESDAY • 2 DECEMBER 2015 • ISSUE 445 • PUBLISHED EVERY WEDNESDAY AND SUNDAY €1.00 Newspaper post PAGE 6 'Dark clouds on horizon' for Malta's financial services industry KPMG, PN leader warn that proposals recently approved by European Parliament could threaten Malta's booming fi nancial services industry JURGEN BALZAN De La Rue workers have been in- formed that the company will be laying off 300 employees by 2018 after deciding to phase out the printing of banknotes in Malta. The company – the world's larg- est commercial banknote printer and passport manufacturer – will be downsizing its operations in Malta in its efforts to make its global operations more profit- able. MaltaToday understands that the restructuring process will see the security printer terminate the job of 300 workers out of the 550 currently employed. The company yesterday an- nounced that it will relocate its current security products capa- bility from Gateshead in the UK to Malta, however it did not spec- ify the number of workers it will lay off in Malta. De La Rue said it will consult the relevant unions and elected representatives, adding that it will invest around €21 million in equipment and skills to create the centre for excellence at De La Rue's current site in Malta. "This equates to half the invest- ment being made by De La Rue globally," it said. De La Rue to lay off 300 workers Security printing company to invest €21 million in passport printing facility, 300 workers to lose their job by 2018 PAGE 3 KPMG Malta Partner Juanita Bencini