04 October 2006


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Greens target “miserly” budget with ‘new deal’ proposals

Matthew Vella

Alternattiva Demokratika say there’s at least Lm18 million government can inject into the economy without overrunning budgetary targets for accession into the eurozone.
“Government’s Lm8 million is insufficient,” Green party chairman Harry Vassallo said about the planned injection to the economy for the upcoming budget. “Whilst we recognise the importance of meeting the Maastricht criteria, we believe that much more can be done in this budget.”
According to the Greens’ budget working group, at least Lm18 million can be used to stimulate economic growth, reduce taxes on business, provide financial and community support to families, and boost Gozo and tourism without jeopardising Malta’s adoption of the Euro.
The Greens are proposing a mixed strategy to pump up redistribution. The first is an increase in tax for banks and telecoms companies – Malta’s prime oligopolies – from 35% to 40%. Then there is a “serious” clampdown on the abuse of disability benefit which the Greens say is costing the country some Lm15 million every year, to be instead equally routed to increase government revenue and disability allowance increases. Additionally, the Greens want a clampdown on electricity theft with a target saving of Lm1 million and a reduction of five per cent in government’s operating costs except for social security, healthcare and education.
““The Lm8 million government is saying are available are simply insufficient to kick-start the economy… We believe that more can be made available with a bit of political goodwill and courage.” Politically the government must ensure that the funds needed are derived from those sectors that can afford to pay more. There can be no more taxes on the middle-class that has carried most of the financial burden over the last three years,” Vassallo says.
According to finance spokesperson Edward Fenech, the measures proposed will boost government’s available funds to Lm18 million, which the Greens want to see spent on more family-friendly instruments such as annual child benefits of Lm40 per child up to age 16, reduced tax on spouses’ salaries for working in family businesses, Lm1 million in subsidies for childcare facilities in a bid to improve women’s participation in the labour market, and the elimination of the electricity surcharge for the poorest 17,000 families.
“Rather than a general reduction in income tax, that would be giving more to those earning more, we are proposing that assistance be targeted to those families raising children,” Fenech said.
“Another sector that requires assistance is undoubtedly tourism and therefore we are proposing a further Lm1.5 million to be invested in the sector. We are proposing additional investment in Gozo for tourism, as well as the promotion of the island as a call centre base. We are also proposing a restructuring of the energy surcharge system where the rate of surcharge would be determined according to the level and trend in consumption rather than the present system that imposes a punitive 64% surcharge on everyone irrespective of consumption levels. We are also proposing that the venture capital fund of Lm1 million, originally proposed by government three years ago and never implemented, is made available in the first quarter of 2007.”
Harry Vassallo also insisted that the departure tax must be removed. “Alternatively we are proposing a carbon tax of Lm10 if the proceeds from this tax are invested in improving public transport… More is needed from this budget. The population must be rewarded for three years of austerity imposed by a government that has been reckless with the people’s money,” Vassallo says, claiming those sectors making super-profits must give more when the population at large is asked to make sacrifices.
“We can no longer continue living in a country where a few make millions and the vast majority struggles to raise their families and make ends meet. Government must have the courage to give this country what it deserves.”

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