When the Prime Minister gave private gym operators the stick for not passing on tax savings to consumers, a government agency was doing exactly the same.
Users of the national pool at Tal-Qroqq complained to this newspaper that membership fees for 2016 did not reflect the VAT reduction, down to seven per cent from 18 per cent.
However, when contacted yesterday Mark Cutajar, CEO at Sport Malta, which runs government sport complexes, said swimming pool prices would be reduced in the coming days to reflect the tax reduction.
“Membership fees for the use of the national pool at Tal-Qroqq will be reduced and the new prices will be backdated to January 1,” he said, adding the difference in fees would be refunded in the case of those who paid their membership at the beginning of the year.
He clarified that gym facilities at the government complexes were run by private operators and fell outside Sport Malta’s remit.
Mr Cutajar said prices were not reduced immediately because it was unclear whether the VAT reduction also applied to the swimming pool. “I was awaiting clarification from the Finance Ministry but the legal notice is expected to be out shortly and we have embarked on the process to change our pricing software.”
On January 4, the Finance Ministry issued guidelines to operators informing them of the new VAT rate for the use of “sporting facilities”. The focus was drawn to gyms by Prime Minister Joseph Muscat last week when he lamented that some operators failed to reflect the reduced VAT rate in membership fees.
An exercise carried out by this newspaper showed that some gym operators had passed on the savings to consumers while others kept last year’s prices.
Those who did not lower their prices justified their decision by citing higher expenses and investment in new equipment. Others claimed to have postponed planned increases as a result of the VAT reduction.
But the VAT change does not only impact gyms. It affects all sport-related facilities, including squash and tennis courts and football grounds.
Operators are not obliged to pass on the savings to users and the consumer authority can do nothing about it because the sector is competitive.
kurt.sansone@timesofmalta.com