The Malta Chamber of Commerce, Enterprise and Industry believes next week’s Budget should focus on ensuring growth and bringing the country’s financial house in order.
In its proposals for Budget 2012 which it has passed on to the government the Chamber says: “These two matters need to be tackled effectively or the authorities might be left with no alternative but to resort to higher taxation. This would further damage national competitiveness and chances of growth.”
Chamber President Tancred Tabone told The Times Business: “There need to be incentives for growth, financial consolidation and a stronger emphasis on the belief that the private sector is the motor of the economy. Also, the priority should be on wealth creation before wealth distribution.”
The Chamber’s proposals stress that the country’s deficit and debt must continue to be tackled, including the financial situation of government owned companies. It says undeclared economic activity, the abuse of social benefits and the sustainability of the health and welfare systems must be addressed.
It says pro-active measures should be introduced to enforce fiscal morality and eliminate the black economy and the government should not resort to giving amnesties to tax evaders and “resorting to honest taxpayers to make good for what others fail to contribute”.
The Chamber is proposing that businesses should be given the option of choosing to fix their utility tariffs for a number of months, similar to a system of hedging, so that they can plan ahead.
It is also calling for the setting up of a dedicated unit within Enemalta and ARMS to offer efficient services to high utility users. “Get an efficient private company to take care of the water and electricity bills. This should have never be left to a government company like ARMS,” Mr Tabone said.
The Chamber is once again calling for productivity to be included in the COLA formula and for the right environment within the public sector bureaucracy to allow the private sector to generate economic growth. It stresses that the Chamber supports a shift from direct taxation to environmental taxation “as long as any increase in environmental taxation is balanced with commensurate declines in direct taxation for taxpayers that attain the pre-determined environmental criteria”.
The Chamber says that traditional promoters of growth must be kick-started and emerging sectors must be nurtured. It is calling for a long-term industrial strategy to focus on long-term sustainability and competitiveness, the survival of a restructured and competitive national airline, clear policies for development and their consistent application by Mepa to give a clear message to investors and the stepping up of efforts to establish Malta in the digital gaming sector.
The proposals include the need for Malta’s embassies to be supplemented with effective trade and investment offices, the marketing of Malta as a soft-landing zone for North African business and the introduction of an Enterprise Investment Scheme to offer better tax incentives to investors who purchase shares in new smaller, higher risk, innovative companies.
The Chamber is also calling for measures to be introduced at a national level to enhance female participation in the labour market such as the extension of school hours, further support for childcare and the banking of hours. It is once again calling for the updating of working practices in the public sector.