Maltese Opposition Proposes Changes To 2009 Budget

by Ulrika Lomas, Tax-News.com, Brussels

13 November 2008

Labour leader Joseph Muscat has put forward proposals to improve Malta’s ‘eco-friendly’ budget, unveiled last week by Malta’s Finance Minister Tonio Fenech.

Fenech’s budget introduced many eco-friendly policies including higher taxation on more polluting vehicles and subsidies for those using more environmentally friendly forms of transport.

Muscat agreed with the plan overall but argued that the abolition of value-added tax on vehicle registrations should include those who paid after May 1, 2004 – the date Malta joined the EU. Labour has said that if the government doesn’t give a refund right away, they will be taking the initiative to protect consumers and make sure that people who paid VAT on registration tax are refunded.

Also introduced by Fenech was an incentive in the form of tax rebates to encourage mothers to return to work. The opposition leader attacked the move saying the rebates would have limited or negligible effect, especially for mothers who go back to low-paying jobs.

The Maltese government also announced in the budget that it would introduce an additional levy of EUR0.25 and EUR0.50 on traditional light bulbs and neon tubes respectively. Fenech proposed that the extra revenue generated would help subsidise the use of energy efficient sources such as solar water heating systems. However, Labour says that it would instead implement a long-term plan to use the levy’s revenue to supply energy efficient bulbs and ban traditional light bulbs outright.

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