The government said today that it is considering a transition period on the imposition of VAT at 7% on tourist accommodation.

In the Budget speech, Finance Minister Tonio Fenech announced that VAT on collective accommodation was being raised from 5% to 7% from January 1.

The Malta Hotels and Restaurants Association protested strongly, arguing that since agreements with tour operators had already been signed, it was hoteliers who would have to foot the difference.

The Finance Ministry said that a meeting with an MHRA delegation was held this morning, and the government had accepted to consider a transition period on the imposition of higher VAT with regard to the signed agreements with tour operators.

It said that copies of the agreements should be sent in confidence to the CEO of the Malta Tourism Authority by Monday. The MTA offices will be open for the purpose on Saturday and Sunday between 9 a.m. and Noon.

The contracts should be accompanied by an estimate of the number of tourists which are expected to be brought to Malta.

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