The GRTU has said today that whilst the draft plan presented to the European Commission gave an overview of the overall economic direction the next Budget will be taking, GRTU felt it lacked basic vital information to help comprehend how the set targets will be met.

“In the document Government has committed itself to continue the shift from direct to indirect taxation. It mentions indirect taxation on consumer goods and services and a revision in fees on market output. The questions that we naturally pose are: How will these indirect taxes be implemented? What is meant by market output?” GRTU asked.

During a business breakfast earlier this month GRTU probed the Minister for Finance to take action, as was promised in Budget 2014, on Eco Contribution. In reply, the Union said that the Minister stated, similar to the case with the payment of Maternity leave, Government will be moving from direct to indirect taxation.

“This means that businesses will still be footing the bill indirectly instead of directly. What benefit to business this might result in, in relation to Eco Contribution, is dubious,” the Union said.

Whilst GRTU welcomes Government’s commitment not to increase VAT, GRTU said that, “it should be made clear that VAT is not the only tax element that affects prices and competitiveness. Many businesses are today forced to carry the burden of Eco Contribution, which is an unjust and anti-competitive tax, and simply changing its name will not make it any more just or competitive.”

“The biggest problem with Eco Tax is unfair competition and introducing more taxes, be it direct or indirect, will only continue to aggravate the already precarious situation.”

The Union added that all social partners have had the opportunity to raise their priorities and concerns for the next Budget at MCESD and GRTU raised the issues, amongst others, of unfair competition and the eco-tax problem on several occasions now and no concrete replies on this or discussions on the plans were held. “We unfortunately get the feeling that plans are in place but Government is reluctant to discuss them.”

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. We reiterate, MCESD is not a talking shop and it is evident which stakeholders have a clear interest in the issues.”

“Government should come to MCESD with the intent of really discussing the plans or speak directly to social partners to make sure an agreement is reached before any final announcement, GRTU concluded.

Permalink: Malta’s Draft Budgetary Plan 2015 sheds more heat than light, says GRTU