The General Workers Union has welcomed a derogation obtained by Malta during an EU Finance Ministers meeting to retain the VAT exemption on food and medicines.

The meeting also decided that EU countries would be able to flexibly reduce the VAT rate on services in restaurants. In Malta this is going down from 18 to five per cent, the GWU said.

The union praised the work done by the government and by Maltese representatives in the EU. It said it appreciated the country's position especially since a recent EU directive on VAT insisted that each member state should have at least five per cent VAT on food and medicines. This would have been detrimental for Malta.

The reduction of VAT on restaurant services would make restaurants more accessible, the union said.