VALLETTA (MALTA) (ITALPRESS/MNA) – Around 70% of active companies in Malta declare no profits and pay no income tax, Finance Minister Clyde Caruana told Parliament’s Public Accounts Committee.
Speaking during a discussion on tax collection, prompted by a report from the auditor general, Caruana said that despite ongoing reforms, Malta’s deep-rooted problems with tax evasion persist.
“These are not dormant companies,” he stressed. “They have employees on their books yet declare no profits at all.”
The minister dismissed claims, raised by opposition MP Graham Bencini, that companies might be including profits within salaries. “I refuse to accept that argument. The numbers do not corroborate that claim,” Caruana said.
He noted that a new AI-powered system is already monitoring all taxpayers and could soon scrutinise company profits in detail. “At some point we need to start analysing what’s eating away at their profits—or whether it’s being engineered,” he warned.
Caruana admitted that “billions” in unpaid tax debts can never be recovered but said “hundreds of millions” remain collectible. However, he resisted writing off bad debts without cross-party agreement, warning against “turning the issue into a political football.”
Malta’s tax collection system has long been under fire. In 2019, only 35–40% of businesses declared profits, and Caruana recently revealed that restaurants pay an average of just €4,500 in corporate tax annually—less than many individual taxpayers.
He has repeatedly pledged tougher enforcement, saying this summer that tax dodgers would be hit “like a ton of bricks.”
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(ITALPRESS).
