The government is going to clamp down on tax evasion, Finance Minister Clyde Caruana said Tuesday.

He was speaking to journalists after addressing a press conference during which the pre-budget document was presented.

Asked about this, the minister said: "I've been referring to the clamp down on tax evasion for months. We need to do this for the benefit of the entire nation. This government can honour its commitment not to increase taxation and not to introduce any new taxes in this budget, nor even in the foreseeable future, and we can do this as there are enough resources, but unfortunately they do not all go into our tax coffers."

"There will be a clear direction given in terms of how we are going to do this in the budget. Of course, in the run up to the budget, I will provide more details and figures of what this is costing the country. I really want to deliver this message home and for everyone to understand, as in this way we can ensure that this country and its finances can be as strong as ever in the future."

Asked about political party media and their tax issues, he said: "In terms of the media that pertains to political parties and the agreements they have, I will also deliver a message in the budget as to how we are going to tackle tax arrears and also as to the way forward. Rest assure that this issue will be given the utmost importance."

Asked about the deficit he said: "We will reduce the deficit from 12% to 5.6%. We will do this primarily as the economy will be expanding and because the government is looking at the way it spends money. This doesn't mean we will reduce spending or increase taxes. The management of country's finances deserves to be sustainable and handled wisely and because we will do this, we can assure that neither in this budget nor the one after and nor as long as I am finance minister, the tax burden won't increase. We don't need to increase taxes. We must ensure that all the taxes are collected. That in itself would be enough."

The minister was also asked about the FATF's grey listing. He said that the country passed the legislative process, as per Moneyval, and that the country is working to pass the two points which the FATF found issue with.

"Its true Malta didn't pass, but it doesn't mean we didn't register substantial progress. We have two boxes left to tick and we must assure that the work is done over the coming weeks and months."

Caruana remarked that he has always been careful about what he says and announces, and it doesn't mean that because he hasn't announced results that work isn't being done behind the scenes. "I assure you that there is a lot of work ongoing."

Asked about the increase in cost of living, he said that the government must look at this from the wider perspective. "The cost of living is rising as a result of the pandemic. The cost of freight, logistics, certain goods, increased due to the sudden shortage the world is experiencing.

The government can do little to address that, as these are things that have to do with a global perspective. But in this budget, in terms of increases we are going to give to pensioners, or the adjustments we are going to make to certain benefits, we will ensure that those increases will cushion the impact for the greater good of families and pensioners."

Ian Borg on the cost of living

Infrastructure Minister Ian Borg was, at a separate press conference, asked about the rise in the cost of living. He too said that it is a result of the global pandemic. "This does not mean that the government isn't doing something."

He said that everyone in Malta is feeling the effects of the unfortunate rise in the cost of living.

"The government, with its various entities and ministries, are looking into the matter and I am confident that in the next round of elections, the Maltese people would choose the Labour Party to battle this issue and come out victorious."

When asked about the slow rise in wages in Malta, Borg said that "on 11 October we will have the answers. Currently the budget is under consultation and open for journalist's enquiries."

Videos: Miguela Xuereb/Newsbook