The Chamber for Small and Medium Enterprises – GRTU is calling for an immediate discussion about next year’s Budget, insisting Malta’s draft budgetary plan lacks information on how targets will be met.
“While the draft plan presented to the European Commission gave an overview of the overall economic direction the next Budget will be taking, the GRTU felt it lacked basic vital information to help understand how the set targets will be met,” it said yesterday in a statement.
Last week, in the draft Budget sent to the Commission, the government declared its policy was to “shift [the] tax burden away from labour income while keeping the same VAT rates”.
The chamber said that, while the government mentioned indirect taxation on consumer goods and services and a revision in fees on market output, this raised questions about the implementation of these indirect taxes and what was meant by market output.
Welcoming the government’s commitment not to increase VAT, it said however that this was not the only tax element that affected prices and competitiveness.
“Many businesses are today forced to carry the burden of the Eco Contribution, which is an unjust and anti-competitive tax, and simply changing its name will not make it any more just or competitive,” it said.
The biggest problem with the eco tax was unfair competition and the introduction of more taxes, be they direct or indirect, would only “aggravate the already precarious situation”.
Earlier this month the GRTU had called on the Finance Minister to take action on the Eco Contribution, as promised in the last Budget. In the move from direct to indirect taxation, “businesses will still be footing the bill... what benefit to business this might result in, in relation to Eco Contribution, is dubious,” it said.
Social partners had the opportunity to raise concerns about the Budget at the Malta Council for Economic and Social Development. The GRTU had broached the issue of unfair competition and the eco tax problem several times but no “concrete” replies were given or discussions held, it said.
“We get the feeling that plans are in place but the government is reluctant to discuss them.”
The GRTU called on the government to “avoid at all costs a situation where any plans on these highly sensitive issues are unveiled only once the Budget speech is read”.