Call on government to be more generous in budget

Alternattiva Demokratika yesterday urged the government to be more generous in easing the tax burden on individuals and allocating more funds to boost the economy.

"The government is saying that Lm8 million is what it will spare in the coming budget. The sum is insufficient. While we recognise the importance of meeting the Maastricht criteria, one of which is reducing the deficit to three per cent of GDP, we believe much more can be done without over-running the budget targets," AD chairman Harry Vassallo said.

"We target overall budget measures of Lm18 million to be invested in the economy without surpassing the country's obligations with the EU while ensuring that euro adoption is not jeopardised."

AD is suggesting that additional funds could be raised by an increase in the tax rate on banks and telecommunication companies from 35 per cent to 40 per cent. In addition, AD is proposing measures to combat rampant tax evasion by those businesses that unashamedly operated on an "open cash register" basis. It also called for a clampdown on social security fraud and a reduction in the government's operating costs.

"There can be no more taxes on the middle class that has carried most of the financial burden over the last three years."

The party spokesman on finance, the economy and tourism, Edward Fenech said that rather than a general reduction in income tax, that would be giving more to those earning more, AD was proposing that assistance be targeted to families raising children, such as an annual cash benefit of Lm40 for every child, payable to families.

It was also proposing subsidies for child care centres, stronger investment in tourism and restructuring of the energy surcharge system where the rate of surcharge would be determined according to the level and trend in consumption rather than the present system that imposes a punitive 64 per cent surcharge on everyone irrespective of consumption levels.

It was also proposed that the venture capital fund of Lm1 million, originally proposed by the government three years ago and never implemented, would be made available in the first quarter of next year.