Robert Abela is annoyed that the European Commission has launched an infringement procedure against Malta over the passports scheme. He says it’s Roberta Metsola and David Casa’s fault because… nazzjonalisti.
But he says he’ll be defending the scheme on point of principle, not because it’s any skin off his nose. The passport selling scheme, he says, is being wound down anyway so it doesn’t matter all that much anymore.
A look at the budget estimates published by the government on Monday shows the government is projecting to earn €75 million from selling passports. Admittedly that’s not a lot of passports. At a cool €650,000 for the first passport for each family they’re looking to clock around 100 sales contracts, two a week. No wonder the scheme made them lazy.
The odd thing is that €75 million is 66% more than they made selling passports last year and 50% more than they expect to make by the end of this one. Where’s this growth coming from? And how they dare they make a projection for growth when the European Commission has put the legality of the scheme in serious question?
There’s more to consider. Apart from revenue from selling passports (what they euphemistically call the ‘investor program’) they also make money selling visas. They are projecting to make another €6 million from that, which thought down from this year’s projected €13 million, is still €6 million more than a scheme ruled illegal is ever going to earn.
On top of that there are admin fees that Identity Malta charges. Some of that will be handed upstairs to the finance ministry: €13 million are projected for 2021. Not all of it comes from the passport sales business but judging by what the former Malta IIP Agency used to pay the central government until its line item was removed from the government’s budget this week, some €3.5 million comes from selling passports as well.
So passports next year will pour down the government’s gullet some €85 million. That’s the biggest non-tax earner for the government, more even than all the circulation tax paid by all cars driving around the country.
Point is if this is the last hurrah of the passport scheme because it’s being wound down anyway, there’s a big hole in the government’s budgeting that is going to have to be plugged somehow. And very quickly. To put things into perspective this sort of money is what the government spends to run the entire police department. That’s how big this is.
This budgetary wall may hit sooner than Robert Abela has been planning if the Commission’s infringement proceedings go all the way and end up in an outright ban of the scheme.
They’re addicted to it. But we’ll be the ones getting cold turkey when they rip the cannula out.