Labour offers businesses tax credit on surcharge

Labour leader Alfred Sant yesterday unveiled a new proposal aimed at extending his surcharge reduction plan to businesses.

Addressing a televised press conference at party headquarters in Ħamrun on Labour's plans to create more jobs, Dr Sant promised that if elected to office, small businesses (SMEs) would be given a tax credit equal to half the surcharge on their water and electricity bills.

"We will not implement this during the first six days in government as we will do with the surcharge on households," he pointed out. "However, we will do this as soon as possible, when we devise the system."

Dr Sant said that the proposal has already been discussed with the Chamber for Small and Medium Sized Enterprises - GRTU.

Asked to explain the workings of this new proposal, Dr Sant clarified that not all businesses would be eligible but only those he described as "small businesses". He said companies like Farsons or hotels who already benefit from a capping system on their surcharge will be excluded and will continue to operate under the present system.

"Our intention is that the tax-rebate will apply to all those small businesses which at present are not capped," he said, adding that this system was permitted under EU rules.

Speaking on the current employment situation, Dr Sant said the economy was still not managing to create as many new jobs as were needed. Malta had the lowest employment participation rate in the EU and a Labour government would introduce various incentives to boost the economy and create new jobs. The 2,000 new jobs created over the past four years was "the worst record since the island's independence".

"We will aim to have real economic growth of between four to six per cent and to double the turnover of the financial services sector in the next four years."

Dr Sant said that although official statistics showed that unemployment was low, this was not the real situation as these statistics ignored the fact that many people were not included into the system.

Among Labour's proposals for economic regeneration, Dr Sant spoke of less bureaucracy and red tape for business, a new tax-incentive package for manufacturing industries, better promotion and marketing abroad to attract new industries and training opportunities to create more human resources for the IT industry.

He said that Labour would also give a new impetus to small businesses such as those trading in crafts by granting land concessions in identified industrial areas on a rental basis.

"These will then have the means to take out bank loans on this land and develop their business," he specified.

Dr Sant said that with all these proposals Labour will aim to create 6,000 new jobs in industry, excluding those being promised through the Smart City project.