The cost of the Government’s electoral programme meant the tax burden would have to increase by the end of the next legislature, Labour leader Joseph Muscat said yesterday.

The tax ratio – the ratio between tax revenue and Gross Domestic Product – would go up to 37.5 per cent in 2017 from 35.5 in 2011, he said during a political meeting in Luqa.

This meant that for every €100 of tax that the people were paying now, they would have to fork out €106.

“These figures can be easily verified in the Government’s costings, which it released in a rush with half-baked numbers,” Dr Muscat said.

On Monday, the PN listed the cost of every one of the 125 proposals in its electoral programme, amounting to €1.1 billion over four years.

There were two choices regarding the PN’s proposals – either the country’s debt would increase or taxes would have to go up, the Labour leader said.

The plan under a new Labour government was to help the economy grow. This would be done through incentives such as a tax credit of €2,000 to women aged 35 and older who return to work. This proposal would not cost anything because these women were not working, and therefore, not paying tax, Dr Muscat said. Also, small businesses would be able to continue paying 15 per cent tax on up to €12,000 of their earnings.

“It’s fairer like this and there is no incentive for tax evasion. The government will take in more money and more jobs will be created,” he said.

Those who worked part-time would be able to earn up to €10,000 instead of the current €7,500 against the 15 per cent tax rate, he said.

“We are offering a solution so that people can put their minds at rest and declare their earnings. This means more money will come in.”

The Government was no longer credible as it had been a failure, especially in the past five years, and would fail again.

Dr Muscat said that, three months ago, Finance Minister Tonio Fenech had said the economy in 2012 would grow by 4.3 per cent while the document presented this week by the Nationalist Party said the economy grew by 3.6 per cent.

Mr Fenech and Prime Minister Lawrence Gonzi did not even agree on the year when Malta would have a surplus budget – Mr Fenech said 2016 while Dr Gonzi said 2015, Dr Muscat said.

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