New Zealand’s Jacinda Ardern warmed socialists’ hearts worldwide yesterday with a pledge to raise taxes on the wealthy, coupled with an increase in the minimum wage, but Malta won’t be going in that direction anytime soon.
Finance Minister Clyde Caruana confirmed during a recent interview with Mark Laurence Zammit that the government doesn’t intend to increase a single tax in its Budget for 2022.
This would make it the fifth consecutive year that Malta wouldn’t have introduced new taxes, and this despite the economy taking a huge hit due to COVID-19.
“A number of European countries are discussing tax hikes because their governments are on their knees, but I absolutely disagree with this reasoning,” Caruana said, harking back to austerity policies imposed by some EU countries after the 2008 financial crisis.
“Germany had told Italy, Greece, Portugal and Spain that their deficit was too high and that they had to increase taxes despite being on their knees. It took their economies eight to ten years to start recovering, and if nothing else it should be a lesson for everyone to look at.”
“I want the next budget to give the economy all the fresh air it needs. Once the pandemic is over, some countries will be so heavily indebted that it will be hard for them to get back on track and other countries wouldn’t be in that position and it will be easier for their economies to grow. I want us to go in that direction.”
And although Caruana wasn’t asked for his opinion about taxing the rich during that interview, he had already ideologically come out against it a few months ago.
“We’ll encourage those who earn more, those who have the capital, to invest that capital to create additional economic wealth,” Caruana told Lovin Malta last December. “If there’s the creation of jobs and employment opportunities, that will surely help in furthering economic growth.”
“If there’s capital, the best way to go about it is for the capital to find its way into the economy again in terms of investment, because that will help restore economic growth. If it’s taxed by government, I’m not sure government can compete against private business in terms of employment creation.”
“Let’s let the private sector create jobs. Welfare support must be taken care of by government, but ultimately we should know where the government stops and the private sector starts.”