‘The Shift’ fraud 

The Shift delights in anything that can cause damage to Malta.  Now, that is.  Because before 2012 Malta was a heaven.  In fact, it was a haven for all sorts of people who wanted to evade and avoid tax as well as hide illicit gains.  This was part of the financial services industry, which the […]

The Shift delights in anything that can cause damage to Malta.  Now, that is.  Because before 2012 Malta was a heaven.  In fact, it was a haven for all sorts of people who wanted to evade and avoid tax as well as hide illicit gains.  This was part of the financial services industry, which the PN still boasts was its creation.  It was a tax haven in the worst sense of the word.  It was, in fact, on a so-called OECD black list.  But that’s ok; anything a PN government does is naturally good.

On 14th November, The Shift was at it again, reproducing an article in Bloomberg under the heading “Malta ‘tax haven’ used to defraud US tax authorities of hundreds of millions of dollars”.  Billions of dollars are being stashed in Maltese offshore companies and secretive accounts have cost the US Internal Revenue Service hundreds of millions of dollars, lamented The Shift, as it shafted Malta.  Of course, any Maltese would feel sorry for the USA – you know, the country that uses the dollar to live beyond its means and offload its debt onto the world, including Malta!

But, let’s calm down and ask ourselves whether The Shift might have a point. The consensus is that a tax haven is a jurisdiction where foreign individuals or companies may receive or own assets and income without paying high taxes on them.  Generally, tax havens have zero or low taxes, minimal or non-existent reporting requirements, lack of transparency obligations, and lack of local residence (physical presence) requirements.

There is no comprehensively defined standard for classifying a tax haven country.  However, several international regulatory bodies, such as the Council of the European Union and the Organisation of Economic Cooperation and Development (OECD), have guidelines.

The most credible answer is to refer to the OECD’s list of uncooperative tax havens and the EU’s list of non-cooperative jurisdictions for tax purposes.  No jurisdiction is currently listed on the OECD’s list of uncooperative tax havens. However, the EU lists 16 countries as non-cooperative jurisdictions for tax purposes (the British Virgin Islands, Russia, the Marshall Islands, and Costa Rica are the latest additions).  Hence, for all intents and purposes, Malta is not a tax haven.

In the past (that is before 2012), dealing with a tax haven was almost synonymous with tax evasion and money laundering.  People used such jurisdictions for tax avoidance by hiding money from tax authorities back home.  That’s why, now, most tax-friendly countries consider the title of a tax haven as derogatory and do their best to stay away from it (through proper compliance with international financial organizations).

But The Shift continues to delight in labelling Malta as a tax haven.  It surely deserves all the opprobrium it can get.

C’est à cause du trafic

The massive traffic jams last month, apparently caused by the Sigma conference in Marsa, confirmed for the umpteenth time that widening roads and building new ones is self-defeating and a waste of public funds. The end of traffic jams has been confidently predicted by the road and infrastructure authorities.  If they were made to pay for their failed predictions, the fiscal deficit would be eliminated overnight.

We all recall how it had been confidently predicted that the Marsa Junction multi-layered overflies would save drivers 692 hours of travel time every day.  The Central Link project would drastically reduce journey times and congestion: it was predicted to decrease particulate matter pollution and nitrogen dioxide emission by up to 66% and 41% respectively by 2030.  The Kappara flyover was touted to bring €3.5 million in benefits from reduced waiting time, together with €1.1 million in benefits resulting from a lower number of accidents, with the saving of 100,000 litres of fuel as a result of lower congestion.  Wait, I forget the new Pembroke project which, at a cost of 70m, will make it easier for traffic from the North of Malta to get to St Julian’s and get stuck there.

Infrastructure Malta had assured us that, for every €1 million that would be invested in various road project, road users, residents, and businesses in Malta would get back up to €16 million in reduced travel times, lower accident risks, fuel savings, and improved air quality.

€160 million later, is the situation substantially better?  Most motorists think not.  I doubt whether we will ever see any studies showing whether the claimed benefits have been realised.  Evidence-based studies have never been our forte.  The reality is that wider roads and new ones will only attract more traffic.  The evidence: the 43 new cars per day being added to the stock of cars in Malta.

Meanwhile, we do not even take some measures which have been found to work like, for example, road space rationing (also known as alternate-day travel), driving restrictions, and no-drive days.  These are all travel demand management strategies adopted in various countries – Spain, Portugal, France, Mexico, Chile, and elsewhere – aimed to reduce the negative externalities generated by urban air pollution or peak urban demand in excess of available supply or road capacity.

Why?  Because the ‘car is king’ mentality reigns.  What is the solution: build further multi-lane highways on top of existing ones and new flyovers over the flyovers?  Would it prevent a repetition of some MPs arriving late for a Parliamentary meeting and have to tell chair “c’est le traffic”, in spite of the claim that “in harmony with the vast improvement of our roads network through huge and often challenging infrastructural projects, such as those at Marsa and the Central Link”, traffic jams would be eliminated?

That same pigeon tells me that the scenario-builders in the PN are counting on what might win them the next election if their leader continues to sink in the polls and voters remain unimpressed with their programme. This would be another massive logjam on the eve of the election which would infuriate voters and make the 30% who say they will not vote throw their lot with the PN.

Forgive my sarcasm, borne of despair!


Ifyou happen to be keen on stories about narcotics and are tired of watching the endless Netflix series, you might do well to read  Narcas: The Secret Rise of Women in Latin America’s Cartels.  It is written by journalist Deborah Bonello, who introduces readers to the powerful women who run some of the region’s most violent and profitable drug gangs.

Bonello is a Maltese writer, an editor, and an investigator based in Mexico City.  Though she was born in Malta, Bonello was brought up in the UK, after which she moved to Latin America to work as a foreign correspondent in 2005.  Deborah is senior editor for Latin America at VICE World News and has nearly two decades of experience covering organised crime and criminal syndicates, particularly the drug trade, as well as the violence and culture connected to the crime world. She’s contributed to several publications, including The Guardian, the Los Angeles Times, the BBC, and The Telegraph.

Few of the women about whom Bonello writes are household names like those of male cartel leaders Joaquín “El Chapo” Guzmán and the late Pablo Escobar.  Even fewer resemble the glamorous femmes fatales that populate TV and film melodramas about the narco world.  

A lot of the research about women in organised crime has painted them as victims of sex trafficking or “mules” who were forced to carry drugs.  Bonello had the feeling that it really couldn’t be that simple and that, even if women had probably initially been trafficked themselves,  some of them became empowered and rose to become very powerful matriarchs.

Foreign Affairs, the reputable journal, says that Bonello “attempts, with some success, to subvert the stereotypes of women as passive victims or as gangster molls serving as mere accessories for dominant males.  Instead, she finds strong females boldly seeking money, power, and status for themselves and their families.”  Publishers World  adds that “readers fascinated by organised crime and the inner workings of investigative journalism will want to check it out.” 

Empowered women

Our world faces a persistent gap in access to opportunities and decision-making power for women and men.  Globally, women have fewer opportunities for economic participation than men, less access to basic and higher education, greater health and safety risks, and less political representation.  These issues exist in Malta too.

However, figures published by the National Statistics Office (NSO) last week show that things may be changing.  The NSO published data that women account for almost 67% of students enrolled in diploma courses at the University, those at bachelor’s level account for 56% of students, while those going on to do a master’s degree are 60%.

This isn’t a recent phenomenon, says Prof. JosAnn Cutajar, who chairs the University of Malta’s gender equality and sexual diversity committee, who points to a trend that became visible in 2014.  It is unfortunate, therefore, that this is not the case where it concerns female students doing PhDs, where the percentage falls to 44 percent.  Cutajar attributes this to societal expectations about the role of women, parental leave, and institutional sexism.  It’s that glass ceiling again.

Photo: Karolina Grabowska
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