The Malta Chamber of Commerce, Enterprise and Industry is concerned about "the uncertainty that has been allowed to creep into the business community ahead of the forthcoming budget".
In a statement this morning, the chamber said the uncertainty was the result of unclear messages from the Finance Ministry regarding increased revenue from indirect taxes being envisaged to narrow the budget deficit.It noted that the signals emerging from the authorities so far served to heighten rather than dispel such uncertainty."The Chamber regrets to note that the necessary assurances were not forthcoming at the last MCESD meeting held in the presence of the Minister of Finance."On the contrary, recent, ambiguous communication from the Customs Department further fuelled confusion and suspicion amongst economic operators," it said.
The chamber said that such confusion and fear was justified given Malta’s poor track record in enforcing payment of indirect taxes through fair and effective market surveillance.
The compounding effect of excise taxes, eco-contribution and VAT further added to the concern of tax abiding operators.
Therefore, the prospect of raising the tax differential between Malta and neighbouring member states was not acceptable because it rendered contraband all the more attractive to the detriment of Government coffers and tax compliant businesses.
"Official statements to the effect that enforcement will be stepped up, provide little comfort to the Chamber because it has heard them several times before.
"Ironically, from past experience, it was bona fide operators who bore the brunt of increased investigations because they presented a more convenient target to the authorities.
"Meanwhile, these operators needed to face unfair competition from illicit traders which were allowed to place items on the Maltese market without the fulfilment of any fiscal, environmental or consumer safety obligation."
The chamber urged the minister to carefully assess the situation before announcing, at the next budget, any measure which could be counter-productive to Government and business.