GENERAL ARTICLES

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Tax without tears

Published on the Business Today, issue Wednesday, 26 March 2008

 

The merits of uprooting regressive taxes have recently hit the headlines prior to elections mainly in the manifestos of the smaller parties. The new prime minister contemplates this in a mood to paint our taxes green. In fact the fair isle of Gozo is destined to be morphed into an ecological paradise. This calls for a concerted use of renewable energy and better protection of the environment. This is all very desirable.

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Polishing a jewel

Published on the Business Today, issue Wednesday, 12 March 2008

 

Now that the euphoria over the general election has subsided it is time to calmly reflect on the number of electoral promises made by this new team of young Turks all eager to set the ball in motion under the motto ‘Yes, together everything is possible.’ The race for the best ideas on how to regenerate the inner harbour area was championed by both parties.

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Epitaph on a marketeer

Published on the Business Today, issue 27th February 2008

 

Little was written about the loss of Sir John Harvey-Jones in Malta’s financial press when he passed away on 9th January 2008 at Hereford County Hospital. Sir John Harvey-Jones, ex-chairman of ICI became a TV business guru associated with an eccentric look of long unkempt hair, colourful ties and a bonhomie smile. Undoubtedly, he portrayed himself as a outwardly confident and charismatic leader.

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The fight against treaty-shopping

Published on the Business Today, issue Wednesday, 20 February 2008

The worn out cliché goes that the only inevitable events in our life are death and taxes. The past 20 years have seen a measured, yet invigorating growth of the island as a financial centre. I remember clearly how in 1988, the year that ushered the birth of MIBA as a new institution, heralding the start of an offshore regime.

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Can the credit crunch hit us?

Published on Business Today, issue 13th February 2008

As an emerging economy, Malta, within an enlarged eurozone, enjoyed rapid growth in 2007. This is commendable. But are we set to withstand the spreading global credit crunch and a possible recession in the US? The answer is given in a recent International Monetary Fund (IMF) report .

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Are audit firms over-regulated

Published on the Business Today, issue 6th February 2008

View image detailThe scandals that rocked the accountancy profession show no sign of dying away. Over the last few years public confidence in the auditing of company accounts was seriously shaken by corporate scandals such as Enron in the US, Dutch retailer Ahold, Italian Parmalat and Societe Generale in France....

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Democracy for sale

Published on the Business Today, issue 23rd January 2008

View image detailAs voters have gone back to their normal work routine following the Christmas holidays they are a bit weary from the incessant bombardment of pre-election promises. Traditionally voters are afraid of losing what is theirs by right and are always seeking to get the utmost from whatever or whoever is the party in power. Now, as part of the EU club no effort is spared to make most of the eligible funds. With equal gusto voters sense that it is a jolly good time.

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Making a euro cross

Published on the Business Today, issue 9th January 2008

View image detailThe new year gave birth to a new form of cynicism precisely that of combating the euro hype.
NECC reminds us that euro is extremely important to us. Its leaflets assure us of the net benefits that we are going to reap which in the long term are positive and substantial.

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Led Zeppelin returns this Christmas

Published on the Business Today, issue 19th December 2007

View image detailReaders during Christmas time may well stop and reflect on what this great event means to us? By now, most homes will be decorated with Christmas trees, coloured lights and paper or plastic decorations around the rooms (less than last year since surcharge bites). These days, more people decorate their front garden trees or house walls with coloured electric lights and prop up plastic effigies of Father Christmas assaulting their balconies.

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Bureaucracy beckons

Published on the Business Today, issue 12th December 2007

A big PR razzmatazz was drummed up four years ago when a White Paper entitled ‘A Public Service for the 21st Century’ was launched. It announced new public service charters. These would commit departments to deliver on what citizens could expect the public service to provide them with. Government services were to be packaged as part of a consumer-oriented programme, in which the taxpayer would be considered king, or at least be acknowledged to have significant rights.

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A city built for gentlemen

Published on the Business Today, issue 28th November 2007

 

Last week the headline news on Times of Malta augured a bumper Christmas for Valletta shops. This is not only a result of the laying of porfido tiles and savvy street decorations which are considered so spectacular that they warrant the Prime Minister’s personal attendance on its inauguration. Pundits say this sales bonanza has something to do with cash hoards surfacing before the closing deadline for euro conversion. Paradoxically ,shop owners in Merchant and St John’s streets have seen their sales plummet due to a six months delay in the paving process.

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Taxing consumption not work

Published on the Business Today, issue 21st November 2007

You will be forgiven if you think that after the announcement of the 2008 budget both political parties are being accused of promising too much. The Opposition is keen to launch its own promises based on four additional proposals whose true financial cost has been put in doubt.
These included a halving of the surcharge, abolishing tax on overtime work, giving back holidays that fall on weekends and reaching a higher GDP growth of 4 to 6 percent.

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Will the global credit crunch hit us?

Published on Business Today, issue 31st October 2007

 

It is surprising and yet reassuring how the credit crunch which hit global banks because of sub-prime mortgage crisis has so far spared us. Read the Economist magazine and you will notice how the credit crunch has reached a new intensity, with the cost of borrowing money in London's money markets hitting a new high in spite of the Bank of England's attempts to cool the system by pledging to inject more cash.

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Wrongful and fraudulent trading

Published on the Business Today, issue 16th October 2007

Autumn leaves are falling and the first torrential rains played havoc in low lying areas. Yet the autumn fresh air has also morphed into a landside court decision that took five years in the making. The Times of Malta reported last week that Mr Justice Tonio Mallia, sitting in the First Hall of the Civil Court, concluded that Victor Zammit, Christopher Gauci and Wallace Fino had committed fraudulent and wrongful trading in connection with PCO and the company’s creditors. They were held personally and unlimitedly responsible for the debts incurred by Priceclub Operators Ltd (PCO).

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Greener credentials?

Published on Business Today, issue 12th September 2007

Our politicians are all very hunky dory in exclaiming their heartfelt intentions to reposition sufficient funds for a cleaner air and better environment, but then successive budget deficits have obliterated their noble intentions. With Lm1,480 million in debt there is little left in the kitty to embark on mega R&E projects.

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Race for Valletta regeneration

Published on the Business Today, issue 29th August 2007

The race for the best ideas on how to regenerate the inner harbour area is being championed by both parties .It all points to exciting months ahead, first through competing ideas by party spokesmen vying for votes. Can we risk doing something in haste. Surely regenerating the entire inner harbour area is a monumental task.

 

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Carrot and Stick

Published on Business Today, issue 8th August 2007

Last week Times of Malta reported that taxpayers were still undecided about the amnesty granted by government in order to regularise their tax status. The assumption is that many of these people will not have declared the principal neither the interest accruing on those assets nor, in many cases, the undeclared earnings constituting the provenance of money invested in local banks.

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The silence is deafening

Published on The Business Today of the Wednesday, 25 July 2007 issue

Lord Conrad Black and three others are accused of fraudulently diverting almost $84m from Hollinger International, the newspaper group he used to lead. He was cleared of one count of racketeering but was found guilty of four of the 13 charges against him.

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Making the world greener

Published on the Business Today of the 11th July 2007

We feel belated solidarity with former US Vice-President Al Gore congratulating him on keeping his promise to hold Live Earth concerts in favour of a cleaner planet held on seven continents on the date "7/7/7". Many of the world's biggest pop stars performed at Live Earth concerts around the globe last week to try to persuade fans and governments to go green.

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Ireland should be our economic model

Published on Business Today of the 4th July 2007 issue

Last week saw a smiling Dr Gonzi leading a select delegation to the World Investment conference held in La Baule, France. The two-day event offers a dynamic base for the joint consideration of issues relating to the attractiveness and competitiveness of Europe.

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PKF Malta & Co. - Reaching Out

Published on CNBC July Issue

George Mangion, Senior Partner of PKF Malta & Co. - an audit and business advisory firm - has been instrumental in establishing numerous iGaming companies on the island and has vigorously championed Malta as a "prime captive insurance destination."

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Commissions and allegations aside,

we can rejoice Mater Dei is about to be finished

Published in the Business Today of the 6th June 2007                                        

Can we ever ignore the quality strides in healthcare service. Certainly this is a long term goal that started years back with Dr Fenech Adami 's vision to build a specialist clinic called San Raffeale.

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Thanks to the European directives particularly for groundwater, habitats and landfills, which impose increasing constraints on the public and private sector, we have started smarting up in our ways

It is a well accepted fact that in a small island such as ours, land will always fetch a premium and public pressure is constantly forcing land-use changes and creating a demand for better land management practices. Now that we have secured EU funds to rehabilitate Maghtab, it begs the question of what is the best use of such a massive track of land.

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How can a Tigné Point seafront 'penthouse' apartment which when finished would cost to build less than Lm100,000 (excluding cost of site) be fetching over  Lm750,000 when gross wages and salaries in building industry has not reflected such price inflation.

Most of the prime sites given on easy terms in the early seventies to encourage hotel building have been pulled down to create a concrete jungle of luxury apartments worth multiple millions in resale value. Can we blame estate agents? Not really. 

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Shedding the Cinderella icon 

We need to upgrade our attitudes towards SME and help them shed their image as the Cinderella Government is too pre-occupied with mega projects such as SmartCity and large development sites to notice the minnows. This is wrong. Malta must emulate the European Commission's endeavours to help SMEs.

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Now we have to really take into account the catastrophe of global warming that lies ahead

Closer to home we never realise the damage to our air quality when we allow emissions from power stations and the hospital incinerator go by unchecked in a densely populated island.  One reason our Marsa power station industry is licensed to spew out so much pollution is because of the mistaken perception that it will soon be dismantled.

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A cash rich society

Just consider that up to 2006 authorities reported Lm520 million worth of cash and coin in circulation, equivalent to Lm1,300 per capita. Money Laundering has hit the headlines recently when a woman was sentenced to six years in jail and her assets confiscated for money laundering. A 34-year-old woman was recently jailed after she admitted her participation in a money laundering operation involving $164,000. This was the first case of the sort to be tried in the Maltese criminal courts.

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Can economists explain why the pillars of the economy have entered a slowdown while the financial and property sectors are booming?

A staggering 46,000 units were given permits between 2000 and 2006. First-time buyers will not be enough to fill the 10,400 units given permits in 2006 alone. There is a strong lobby from property magnates who wield a lot of muscle with politicians and can wield an upper hand, threatening non-issue of permits with the hundreds of employees on their payroll.

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Cyprus, the country with which Malta often likes to compare itself, reports a rise of 3.8 per cent in economic growth, representing a slight drop over that for 2005. But Latvia jumped from 8.6 per cent to 11 per cent. What went wrong with our performance?

To recoup the millions lost on public projects such as Drydocks, Air Malta, Mater Dei, roads cost overruns, delays at Mgarr harbour, etc, we need to work harder. Yes, this means reducing holidays and improving our work ethics.

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While Enemalta's inefficiencies are slowly diminishing,

in the short run we must seriously start improving the

 government's fragile energy strategy

It is no consolation that it is late, yet finally the monopoly enjoyed by Enemalta will be partially disbanded. This is another leaf in the book of anti-monopolistic measures that have been driven by EU membership.

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The oracle at Castille. This government is no longer ossified but is taking the courageous decisions..

There seems to be a positive feeling in the air of late. The oracle at Castile is foretelling a brighter future and the political omens look promising. Just to mention the courageous decision by Dr Gonzi to terminate early the spring hunting season is a monumental swing underpinning an assertive government.

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Single currency challenges

For the first time since the fall of the Roman Empire most of Europe has a single, common currency. The US dollar faces its toughest challenge to its hegemony since it displaced the British pound sterling as the world's most important currency after the First World War. The euro goes from strength to strength.

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A nation that attracts the admiration of many

Dr Gonzi's easy way to silence the doom-mongers was to be profligate but he resisted the temptation when announcing his vision at the P.N. council, whereas a lot of Jeremiahs kept looking into the concluding speech for rebuttals on matters such as alleged sleaze and corruption that the opposition touted prevails in the administration.

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How can we attract foreign investment when the cost of a short-stay is starkly prohibitive? We are losing out on the short-stay market.

Published on Business Today 28th February 2007

QUOTES: An alternative is to privatise Air Malta partially. If Austin Gatt can attract an investor who acquires the airline, develops the cargo section into a secondary airport and work the rags-to-riches miracle that HSBC has performed with its acquisition of Mid Med - then so be it.

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Will Malta really manage to fulfil EU obligations on renewable

energy and cut fossil fuel dependency?

Our politicians think it is all very hunky dory in exclaiming their heartfelt intentions to reposition sufficient funds for a cleaner air and better environment, but then successive budget deficits have obliterated their noble intentions.

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Land-use changes and demand for better land management

It is a well accepted fact that in a small island such as ours, land will always fetch a premium and public pressure is constantly forcing land-use changes and creating a demand for better land management practices.

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 Watch out for a property crash

Last month, the International Monetary Fund sent shudders through financial markets warning that America's sub-prime mortgage crisis could deepen and contagion spreads to other countries.

 

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Why has Malta, an island with no proven petrochemical

 reserves not started in earnest to consider tapping Mother

Nature's free renewable energy resources?

QUOTES - Malta currently obtains 100% of its energy from imported fossil fuels which with the help of EU funding may be partially replaced by new and renewable wind and solar power technologies. Ideally, we should set aside part of the surcharge tax for a future alternative energy project that reduces health and environmental damage resulting from burning fossil fuels

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Prophets of prosperity     

Published on Malta Today 21st January 2007

Midway through the festive season we feel capricious about ourselves and our newly acquired feeling of richness and prosperity. This is not a factor exclusive to Malta  as all around us in Europe we notice how growth in the past decade has been pulling millions out of poverty. It is also apparent in over populated countries such as India and China albeit at a slower rate.

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The evolution of the Maltese economy and its integration

 into the European market has since us being pulled

out of poverty and into a newly acquired feeling of prosperity

QUOTES 

We can look forward to a prosperous new year where our hard earned windfall and rising affluence will extend our horizons and widens opportunities to match the affluence of Luxembourg

A cool Lm1,400 million in national debt needs to be tackled as we still labour with loss-making entities such as Drydocks, Enemalta, Air Malta and a bloated public service.

 

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 Another year over...

Published in The Times of Malta of the 21st December 2006 

The year 2006, now fast drawing to a close, will be remembered as a turnaround year for the economy. The economy returned to what appears to be sustainable growth, tourism scraped the bottom but now appears to be recovering thanks mostly to the operations of major low -cost airlines after months of dithering by the authorities.                                         

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 Need Christmas be so stressful?

Published in The Malta Today of the 17th December 2006

With only two weeks to go for what is considered the apex of national festivities can we all reflect about what Christmas means to us? By now, most homes will be decorated with Christmas trees, coloured lights and paper or plastic decorations around the rooms.                                        

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Can we augur that the feeling for the coming

festive season will be jolly and stress-free?

Published in The Business Today of the 13th December 2006

The long suffering middle classes can sigh at the relief when counting their improved take-home pay with the Lm12m cut in direct taxes for next year. The season many expect to be plentiful has welcomed the revised income tax bands.           

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The eventual conversion to the euro means there will be a mad rush to acquire property, works of art, cars and jewellery.

Published in The Business Today of the 29th November 2006

A mini-boom is expected in 2007 and speculators are ready for the big-bang effect. Money laundering has hit the headlines recently when an incarcerated drug dealer allegedly engaged his in-laws to run a company as 'prestanome' for him.                                       

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