Initial reaction to Budget 2015 – Alternattiva Demokratika

Minister Finance Edward Scicluna Budget 2013

Following the presentation of the budget today, in an initial reaction to the measures presented by the Finance Minister, Alternattiva Demokratika Chairperson. Prof. Arnold Cassola, said:

On the plus side, the gradual weaning off social services, rather than an abrupt cut, to those unemployed finding productive work or training is a positive thing. The additional financial aid to parents with young children who go out to work is a commendable measure.

The increase in payments for maternity leave, in particular to self-employed mothers, is a good step forward. We, however, look forward to the minimum wage threshold being increased.

Measures against precarious work and to alleviate poverty are also commendable.

So is the fact that government has finally removed the need formporters of electric and electronic equipment to carry financial responsibility for recovery of waste twice under Eco-Contribution Act
and under WEEE Directive. This had been postponed for the past 7 years. Importers of electric and electronic equipment will now be fully responsible directly themselves for the collection and recycling of electric and electronic waste.

The duty of employers to employ a percentage of persons with a disability has been there since the late 1960s. We look forward now to its proper and true enforcement.

The tax incentive to business companies that donate over 2000 Euros to the Community Chest fund is a positive measure, but it is unfair that this is limited only to business people. It should be extended to all. Even donations to registered NGOs should be tax exempt.
The 15% rebate for those investing in private pensions (third pillar) is also commendable, but this is meant only for those people who can afford such pensions. The government should have concentrated on second pillar pensions, which are shared by the government, the employer and the employee.
The ridiculous increase of 58 cents per week for the cost of living does not reflect the real increase in the cost of living, which has statistically been distorted by the 25% decrease in energy tariffs.

The increase in direct taxation on potentially harmful products like cigarettes and spirits, is a good measure.

Alternattiva Demokratika is asking what is happening at the new Delimara power station. It is unacceptable that Malta will be buying energy at twice the present market price.

As for public transport, the public must be informed of the terms of the agreement with the Autobuses de Leon. We would like to know the details of policies to encourage more commuters to utilise public transport.

Although the small financial incentive for bicycles and pedelecs is a good start, what is needed is investment in infrastructure to make roads safe for these alternative means of transport. Government is contradicting itself when it says that it wants to reduce traffic and at the same time says it wants to create more parking spaces- more parking spaces generate more traffic. It is clear that Government has no vision when it comes to sustainable mobility.

For the umpteenth time, local communities have been lumped with the same financial allocation. This means that Local Councils will continue to struggle when it comes to providing basic services in their communities. There is no indication on whether Local Councils will get funds from trading licences of shops and vendors which operate in their locality.
As for taxes, whilst the income tax rate has been decreased again for those in the 19,500-60,000 Euros tax bracket, this has meant, as AD had predicted an increase in a host of indirect taxes. While Government has introduced social measures for those on a minimum wage, which is in itself commendable, however working people should not be dependent on handouts throughout their lives. The way forward is a devising a mechanism for the periodical revision of the minimum wage.

The government has also failed to address the issue of taxation exemptions for foreign corporations. After Luxembourg and Holland, the EU has already started investigating the fiscal incentives that Malta offers to foreign companies to set up shop in Malta. The issue of a level playing field for all with regards to taxation cannot be put on the back burner.

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