Economic growth projection is unrealistic - GRTU

GRTU director-general Vince Farrugia said today that the 2.5 growth in GDP which the government is projecting for next year is ‘unrealistic’.

Speaking at a press conference, Mr Farrugia pointed out that the most important markets on which the Maltese economy depended were sliding into recession and therefore, it was improbably that the Maltese economy would grow by 2.5 percent, as projected in the budget.

Mr Farrugia said it was a total exaggeration by the government to expect to rake in an extra €182 million from the budget measures and the utility tariffs. In terms of the budget, he pointed out, the government expected to see revenue from income tax grow by €60 million; from social security by €15 million; customs, €16 million and VAT €23 million, plus another €59 million form the utility tariffs.

What would happen if these unrealistic revenue targets were not achieved?

Mr Farrugia also hit out at the government over the way it had carried out consultations ahead of the announcement of the tariffs and the budget, saying there was a lack of confidence in the Malta Council for Economic and Social Development (MCESD).

He said the budget and the tariffs would dampen consumer demand.

He said it was ‘cruel’ that people who had bought cars and paid a high registration tax and VAT would now even suffer an increase in their vehicle licences.

These actions, he said, reflected the actions of a government in panic.