The Malta Chamber of Commerce welcomes the Malta Labour Party's decision to retain the value added tax albeit with a few improvements.

The country has experienced no fewer than three transformations in its indirect system of taxation since 1995, having passed from a system of import duties to VAT in 1995, to CET in 1997 and back to VAT in 1999. Each changeover has proven awkward, complicated, costly and expensive to the business community.

Moreover, due to the unfortunate fact that the subject was over-politicised, the private sector has had to endure a cloud of uncertainty over whether VAT would be dismantled again as a result of an eventual change in government. This uncertainty was unacceptable to the Chamber because it contributed towards increasing risk and cost to the investor and the business community.

Consequently, over the past months, the Chamber tried to seek consensus on this sensitive subject through representations, public statements and an important survey across its membership.

The latter initiative was undertaken in June 2002 to ascertain that the representations made by council reflected the opinions of its entire membership.

The response rate to the survey was encouraging and 93 per cent of respondents said they agreed with the Chamber's favourable stand on VAT. Ninety-five per cent of respondents declared they did not favour another change in Malta's system of indirect taxation.

Finally, 80 per cent of respondents insisted the prevailing VAT legislation was the most suitable for their business from an administrative point of view.

A further 13 per cent preferred the first version of VAT implemented in Malta and only four per cent said they had a preference for the system of Customs and Excise Tax. These results were presented to the leaders of all political parties.

The Chamber acknowledges that, within the country's democratic framework, there must be a difference of ideas between the party in government and that in opposition. Nevertheless, it fails to understand how every national issue becomes heavily polarised and subject to political division to the great detriment of the country.

In recent years, the Chamber actively tried to minimise polarisation to the lowest levels possible. In the same way that it publicly deplored political division in the past, it must now praise this logical step taken by the MLP.

As an apolitical institution that is mainly interested in seeking the common good and better conditions in which its members can operate their business, the Chamber applauds any move which could contribute towards the national interest.

A person, organisation or political party which sheds off intransigence in favour of dynamism and flexibility, particularly where common good can ensue, is perceived by the Chamber as wise, brave and patriotic.

The country is living a crucial period in its already colourful history. The business community augurs that this recent step taken by the MLP can be applied to other significant issues to which, to date, no agreement can be found.

In view of the fact that the country's resources are indeed limited, the Chamber believes the country will gain much more benefit from a situation where a spirit of cooperation prevails between policy formulators and decision-makers.

Malta's recent history has shown that positive cooperation on such issues as the Business Promotion Act, the Trading Licences Act, Malta Tourism Authority Act, IPSE and other financial and business-related laws yielded positive results.

It is vital to learn from our own examples and strive to shape the country's future economic prosperity on the spirit of logic, cooperation and the genuine pursuit of the common good, particularly within the ambit of investment and the creation of employment opportunities, wealth and prosperity that our country so deserves.

Mr Fava is president of the Malta Chamber of Commerce.

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