With regard to recent correspondence there is no VAT on educational services, but on products that can be used for education.

These products have always been taxed. Before VAT's introduction, they were subject to customs duty which was sometimes higher than VAT. When CET replaced VAT, they were subject to excise tax on import and excise tax on products. Today they may also be subject to customs duty, if they originate outside the EU. The major difference is books which were always zero rated and now attract five per cent VAT.

VAT becomes an emotional issue, since it is discernible and consumers know how much tax they pay. Customs duty is hidden in the cost.

Some correspondents rightly stated that if VAT were to be removed, it would be impossible for the seller to determine the purpose for which certain products are to be used and decide whether or not to charge VAT. VAT works on product categories not on a product by product basis or according to different categories of consumers.

Other sections of the media reported that the EU would not allow Malta to remove VAT on certain products.

If any government wants to ease the financial burden on education, it can introduce a VAT refund scheme similar to that available for first time home buyers. Another way is to set up a system similar to the Smartcard system or extend the present system to apply to students in primary and secondary schools.