Finance Minister Edward Scicluna told the social partners that the Budget measures may be tweaked over the weekend but made it clear the deficit target for next year has to be met.
Speaking to timesofmalta.com this morning after addressing a meeting of the Malta Council for Economic and Social Development, Prof. Scicluna said the Budget had to target a deficit of 2.1 per cent next year.
“We will be making changes to the measures between today and tomorrow but everything has to be done within the deficit parameters,” he insisted.
According to some of the union and employer representatives at the meeting, Prof. Scicluna did not delve into the individual measures that will be introduced to raise revenue.
William Portelli from the Confederation of Malta Trade Unions said the minister assured them the Budget will not contain any surprises. “We agree with the drive to cut the deficit but now we have to wait for the detail in Monday’s Budget to assess the impact of the measures,” he said.
As expected most of the questions were about the indirect taxes the minister is expected to introduce or increase to mitigate the loss of revenue from reductions in income tax.
The measures have been kept under wraps with the minister only giving the social partners the macro-economic picture that will emerge from the Budget.
At the meeting Malta Hotels and Restaurants Association president Tony Zahra reiterated his association’s proposal for a reduction in VAT on tourist accommodation to five per cent. “I have re-stated my claim that by lowering VAT hoteliers will be able to use the money to invest in their hotels,” he said later.
Josef Vella, secretary general of the Union Ħaddiema Magħqudin, said his union agreed with keeping the deficit in check but also wanted to see measures that helped the economy grow and provide employees with decent wages.
It was a sentiment shared by Paul Abela, president of the Malta Chamber for Small and Medium Enterprises – GRTU. “We insisted the minister include Budget measures that encouraged small businesses to invest and grow because this is the only way the country can move forward.”
ksansone@timesofmalta.com