GWU wants revision of tax bands

The General Workers' Union is calling for a revision of income tax bands in the upcoming budget on grounds that this would regenerate economic growth and increase purchasing power.

Presenting the union's proposals to the government's pre-budget document yesterday, the union's secretary general, Tony Zarb, said a revision of income tax bands would incentivise middle class wage earners and kick-start the economy.

"People with a low income should be exempt from paying income tax and high income earners should pay slightly more than they do now in order to compensate," Mr Zarb said.

The GWU is saying such a revision should be accompanied by an effort to reduce tax evasion. "The government should present the social partners with a benchmarking procedure for non-salaried workers. It should make sure that the Tax Compliance Unit has the resources to implement this programme," the union said.

A mechanism to scrutinise public expenditure should be established within the Malta Council for Economic and Social Development, the union said in its proposal, adding that the ultimate aim of the budget should be to generate employment and encourage economic growth.

Mr Zarb said the Retail Price Index mechanism should be revised to reflect current spending trends.

"It does not make sense for the fuel price hike not to be reflected in the cost of living adjustment in the next budget," Mr Zarb said.

Asked if the GWU agreed with the suggestion put forward by the Malta Employers' Association to remove the cost of living adjustment (COLA) mechanism, Mr Zarb said the union hoped the government would not heed the employers' suggestion.

The MEA has argued that the COLA was inflating labour costs adding that the increase should be awarded only to minimum wage earners.

"If the COLA is removed, workers will be subject to greater burdens. We hope the government does not listen to the employers as it did when it removed workers' leave last year," Mr Zarb said.

The union argued that the government should reinstate a social housing scheme for those most in need. "This scheme should be run with the government, the private sector and the banks," Mr Zarb said, insisting that people with modest means should be able to buy their own house.

Referring to education, the union said there was wide consensus in the sector and this should make it easier for the country to implement the reforms that are necessary.

The union agreed that the government should identify which human resources were most needed and launch incentives for students to opt for particular courses, practically through more attractive stipends and grants.

Emphasising that students at the Malta College of Arts Science and Technology (MCAST) should not be considered inferior to university students, Mr Zarb said unions should be adequately represented on educational institutions to ensure a greater synergy between the classroom and the workplace.

The GWU said the process the government had embarked on to reform pensions, which saw a wide consultation with stakeholders, should be adopted in other reforms in the pipeline, such as the health system and the ports.

"These reforms should not be used simply as a means to liberalise the services but should be carried out in a way which safeguards workers' jobs," Mr Zarb said.

The GWU said the government should not introduce more taxes.

The government should set up a number of childcare centres once the private sector had not taken the initiative.

Childcare centres were vital if more women were to enter the labour market, the union said. These could be organised through a public private partnership.