Fabian Demicoli

A more comprehensive e-commerce strategy is what Maltese Businesses need

 GRTU has welcomed Government's intention to re-introduce
incentives that will encourage local businesses to set up an online selling
platform. GRTU has been calling for another scheme since the closure of the
previous, successful scheme.

Experience with the previous scheme will ensure
that the new scheme functions better and that the funds will reach the sectors
where they are most needed in line with Government's mandate. Following
thorough consultation with its members, GRTU has presented a comprehensive set
of proposals in line with the eCommerce strategy consultation launched by the
Government late last month.

Online selling still presents a significant challenge for the
majority of Maltese enterprises especially the smaller ones and we estimate
that around 30% of business in retail is being lost to online sales from other
countries it is therefore no longer an option to opt out. Figures show that the
online sales market has been progressing at a fast pace and businesses need to
adapt to this new reality as otherwise they will eventually be forced out of
business.

Many Maltese businesses seem to wish to invest in this medium
and we have identified a number of issues that are holding them back. GRTU has
put forward proposals that build and improve on the previous scheme and
mitigate issues that had arisen.

Government should move from a higher tax incentive to a lower
capped grant that covers all or a large percentage of the whole investment.
Together with this, Government would abolish the three quotes requirement as
going for the cheapest option is not always in the interest of quality and
business.

Clear and transparent criteria for the adjudication and a
point system to prioritize which enterprises need most help according to size
and sector amongst others. These criteria should be designed with the input of
the stakeholders and should be made public.

The assistance would ideally be segmented to cater for the
needs of the enterprise and not just limited to the setup of the eCommerce
site. Upgrading of already existing websites, initial setting up costs such as
consultancy, data inputting and translation services, online marketing strategy
costs, search engine optimization, eCommerce enabled mobile apps, upgrading of
Points of Sale and Stock Control Systems to link to eCommerce sites, should all
be considered for possible assistance.

Reimbursements to the enterprise would be made within strict
deadlines.

MCA would manage a
list of approved service providers that would simplify and fast track the application
process.

A directory of
enterprises having an eCommerce site should be created which would include the
possibility for customers to comment and leave reviews thus promoting a Peer
review mechanism similar to what is being used by major players in the
industry.

The scheme should
consider that Web Development companies might be inundated with orders and
should therefore stagger the assistance over an applicable period of time.

The inclusion of
all business sectors even if purchases cannot be effected online as is the case
with real estate and restaurants. These sectors were excluded under the
previous scheme but still have a lot to gain from a website even if online
purchases are not possible for these kinds of businesses.

There are other factors that are penalizing Maltese
enterprises and holding them back from investing in this medium. The archaic
Eco Tax regime is one of them. This tax is imposed only on Maltese originating
sales and therefore local businesses are at a significant disadvantage. A
Maltese entrepreneur would have to add €35 plus VAT on a tablet that costs €50.
This means that on some items the tax component amounts to half the value of
the items. GRTU has spent a number of years pointing this out. Unless this is
tackled with urgency, it is useless advertising assistance because effected
sectors simply cannot compete. GRTU members have also expressed their concern
on courier costs which tend to be much higher for Maltese businesses.

GRTU augurs that these proposals are taken up and that the
plan is put in action in the very near future as Maltese enterprises have a lot
to catch up on. GRTU will continue supporting its members in their adaptation
to help them increase their competitivity.

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