Author: SME Chamber

The Employment Aid Programme –
for Gozo  Scheme is now open and will close on 6th
December 2013.

To apply for
this program, you can either apply on-line or else you can go to the ETC Office
in Victoria to pick up the form and ask for any information you require about
the scheme.  At the ETC Office you can also
find personnel who can help you in the filling of said application forms.

Tax Related Measures – Tax Deduction for Entrepreneurs who Offer Apprenticeship: Placements Entrepreneurs who are
willing to be part of the system will be given a tax deduction of €600 for
every apprenticeship placement (capped at 800 placements).

Tax deduction for Entrepreneurs who offer Work Placements: Government is offering an incentive
to entrepreneurs in the form of a tax deduction of €600 for every work
placement they accept (capped at 400 placements).

Providing Training and/or Employment to Employees who are between 45
and 65 Years of Age: Government will
offer a tax deduction of €5,800 as an incentive to employers to hire persons
within this age group who have been unemployed for the previous three years,
translating into a saving of €2,030 for each hired individual in this category.
The deduction applies for the first two years of employment. On the other hand,
companies will benefit from a tax deduction on their income or corporate tax of
50% of the training (up to a maximum of €400) for training undertaken by a
training provider officially accredited by the Malta Qualifications Council
upon the provision of a VAT receipt.

Reduction in Income Tax: The Government will be reducing the income tax rate for those income
earners who earn between €19,501 and €60,000 from the current 32% to 29%.

Tax Refund on Vehicle Registration: The Government has allocated the sum
of €2.5 million so that, as from next year, all persons who paid this tax will
receive a refund. The process will be carried out over a period of seven years,
and the ex gratia payment will be provided to those persons who registered a
vehicle for personal use between 1st May 2004, and 1st May 2008.

Abolishing the Tax on Auctions: The tax on auctions is going to be abolished.

Tax on Part Time Income: The preferential rate of 15% will increase from a present threshold of €7,000
to €10,000 for those working part-time, and from €7,000 to €12,000 for those
who work part-time as self-employed. For those businesses that employ two
part-time workers, the 15% will still be applicable.                           Reduction
in Income Tax for Unemployed Women who are over 40 years of age: From 2014,
principal breadwinners whose wives are over forty years of age and have been
inactive for more than 5 years but are going to start employment, earning a
tax-exempt wage, will benefit from reductions in income tax. The income
attributable to the wives will not be considered when using the joint tax
computation. Therefore A married couple may apply for the married tax rates
without taxing the wife's income, if:

This benefit is
applicable for a maximum period of 5 years.

Reduction in Registration tax on motor cycles and non-EU imported cars:
The registration tax on motors having
an engine equal to or greater than 250cc will be reduced. The registration tax
on non-EU imported cars is going to be reduced. The vehicles eligible must not
exceed the 150g/km CO2 emission level and must not be older than eight years.

Excise duty: Excise duty has
increased on a number of goods and commodities including they duty on bunkering
fuel (will increase by €0.35 per metric tonne), excise duty on cigarettes and
tobacco products (being increased by 6% and 9.3% respectively) and excise duty
on alcoholic beverages (being increased at rates of between 2.5% and 15%,
depending on the type of product). Excise duty on cement is also being
increased by €10 to €27 per 1000kg. Excise duty on heavy fuel oil, LPG and
methane is being increased by €2 per 1000 kg whereas that on leaded and
unleaded petrol, biodiesel, gasoil and kerosene is being increased by €20 per
1000 litres.

Value Added Tax: The budget announces a reform in the administration of VAT penalties and
interest as well as administrative proceedings with respect to tax in dispute
both for VAT and Income Tax, giving the necessary discretion to our Courts of
Law when applying imprisonment conditions to faulty taxpayers. Changes are
expected where individuals fail to pay VAT or Income Tax balances on time.

Energy Policy

Reduction on energy bills: As from March 2014, household energy bills will decline by 25% while
water bills will decline by 5%.

Solar Water Heaters, Double Glazing and Roof Insulation Schemes: An incentive scheme will be adopted
to help people upgrade their residence to one which is more energy efficient.
This measure emanates from the National Energy Efficiency Action Plan and is in
line with Directive 2012/27/EU. This measure will lead to a reduction in the
domestic energy use which subsequently reduces the amount of CO2 emissions.

Malta Oil and Gas Corporation: The Government will be establishing a Malta Oil and Gas Corporation.
This will be done so as to provide an infrastructural framework for the
development of an Oil and Gas industrial services industry in Malta. This
corporation will be the Government's leading agency in this regard, and will be
responsible for the implementation of the Government's needs and plans for the
purposes of oil and gas exploration.

Output Potential

Employment Aid Programme: This
tranche of Employment Aid Programme (EAP) will provide employment aid that
covers up to half of the wage s to Gozitan employers. The scope of the
initiative is to promote the recruitment of disadvantaged and/or disabled
persons.

Target Sectors

Gaming: It is
Government's intention to endeavour to enhance Malta's role as a hub for
digital gaming activities.

Managed Seed Capital Fund: An application for the European Social Funds (ESF) programming period
2014-2020 will be prepared to set up and co-manage a Managed Seed Capital Fund
to finance Knowledge-Intensive start-ups. The ESF funds requested will amount
to €11 million over a five year period. It is expected that €10 million will be
directly available as start-up grants and will help finance between fifty and
one hundred Knowledge-Intensive start-ups. The rest of the funds will be used
to finance the setting up of the Fund itself. This measure is expected to
encourage the creation of more Knowledge-Intensive start-ups in Malta.

MicroInvest and Jeremie Scheme: Micro enterprises and self-employed will be supported through a 45% tax
credit on eligible expenditure and 65% tax credit if based in Gozo. In
addition, the Jeremie scheme is going to be continued. These measures will
encourage micro enterprises and the self-employed to invest in their business,
increase their workforce, innovate, expand and implement compliance directives
and aiding in its continued growth by reducing their tax amount payable to the
Government. In turn, this would help increase economic activity.

International Individual Investor Programme: The Government is committed to attract foreign
direct investment for Malta to remain competitive in a global economy. The
Citizenship programme will put us on the same level with Canada, Portugal, Belgium
and Singapore in attracting high-quality investors.

Family Business Act: Family Businesses are the backbone of the Maltese economy. Around 70% of
local businesses are family businesses. Furthermore, in total, there are around
31,000 small family businesses that employ more than 38,400 people. However,
only 30% of businesses which complete the successful transition from the first
to the second generation survive for the long-term. Less than 10% of such
family-run businesses make it through to the third generation. To address this
challenge, the Government will enact the Family Business Act which aims to
ensure the continued existence of family businesses by facilitating the
transition from one generation to another.

It is being called the business
killer and it can certainly kill your business if your system gets infected.
The Cryptolocker is perhaps the most harmful piece of Malware (or Ransomware)
that was ever devised.

Infection comes through an email with a harmless looking
attachment.

The email usually looks like a message sent from a Xerox machine
with an attachment of a scanned document but reports are coming in that this is
not the only type of message that is being used as a carrier. Once the user
opens the attachment, nothing seems to happen but in the background the malware
program will start encrypting your files one by one and will continue to do so
until it completes this process on all your disk drives. Your anti-virus reports
an infection and attempts to contain it but the process would have started
anyway. The infection also spreads to drives through which you are connected to
across your business network, such as shared drives on your server. This is
precisely why it is being called "The business killer". It does not only
encrypt the files on your local system, preventing you to use them in the
future, but also shared files often used company-wide on your server. 

The virus encrypts your
files with very strong encryption which cannot be reversed unless you you have
a special key. The creators of the virus hold the key and will not give you the
key unless you pay $300. This is why this virus is being called ransomware.

Any ICT expert worth his
salt would have come across similar threats and the first inclination would be
to remove the virus. There have been several reports in the local papers of
other viruses claiming that they are from the Malta Police force and that
attempt to pose as real ransomware. In this case, this virus is very different.
The virus itself is easy enough to remove, however, the encryption is simply
impossible to reverse without the key. The virus gives you a solution itself.
Pay the virus developers $300 and the encryption will be reversed and you will
have your files back. Of course, your ICT consultant and everyone else will
advise you not to pay these people, after all they are criminals. On the other
hand $300 is not a huge sum to pay to get back your entire company files.
Paying the virus creators does in fact solve the problem and once paid the
virus will decrypt all of them and remove itself.

Is there any other way to
decrypt your files ?

The short answer is a big
no. The virus uses 2048 Bit encryption which means that if you had to set up
your computer system to try every possible combination of keys it would take
6.4 Quadrillion years to try every combination which is 4,294,967,296 x 1.5
million years! So, we can safely assume that breaking the code is impossible.

Furthermore, the virus gives
you 72 hours before the developers delete the key at their end and every time
you try a key and it fails, it reduces the time remaining by half!

How are these people not
getting caught ?

This virus is very cleverly
made. At time of writing most of the anti virus programmes recognise this treat
as a virus, however, by the time they act the payload would have been
delivered. The virus installs a small programme that runs in the background and
performs the encryption mechanism.

It will probably be obvious
to the reader of this article that the way to apprehend these criminals is
through the payment system. In this case, these people are very clever and only
accept payment through Bitcoins (BTC). Bitcoins are a new virtual (Internet)
currency which allow users to remain completely anonymous. In fact Bitcoins
have been used to buy illegal or embarrassing products such as drugs, weapons
or sex services. Bitcoins are in fact not totally untraceable but if the
receiver is careful it can be very difficult if not impossible to track a
particular Bitcoin. Each coin is worth approximately $150.

In Malta this virus presents
a further problem because of the difficulty in buying Bitcoins. In other
European countries you can actually meet people in the park to buy your
Bitcoins. There are sites which list people who have Bitcoins available and who
are willing to sell them but they usually only accept payment in cash and
nothing else. It is also possible to find people who would accept other methods
of payment but usually this would mean that you would have to pay much more
then the usual cost per coin.

What should you do to
protect yourself ?

First of all, make sure you
have adequate backups. In this case backups which are accessible to users
through shared drives will be encrypted as well, so ensure that nobody except
the system and the administrator has access to backup drives. Furthermore,
offsite backups in the cloud which are becoming very popular are practically
useless in this case. These backups systems synchronise daily or even hourly so
they will have a copy of the encrypted file as well.

Anti virus solution creators
are working on detecting the virus and stopping it in it's tracks before it
releases the payload but reports from users on popular forums show that
detection is not amounting to prevention so far.

As the virus is delivered
through an email attachment in an email which will look like it came from the
same domain name, it is easy to open the attachment by mistake. In spite of
this it is still important to warn your employees not to open any attachments
that they are not expecting even if they look legitimate and if the are coming
from people within the same company.

Finally, if you realise that
you have been infected, immediately disconnect your computer from your network
and call ICT support.

Should you pay ?

If all fails and you end up
with your company data unusable, at the moment you have no other option but to
pay and pray that in the meantime, these crooks are still around to supply the
decryption keys. If your data is not important then simply re-format the PC and
start again.

The citizens dialogue was organized this week by the European
Commission Representation Office in Malta and it was nice to see such an active
participation from the citizens that were present.

The topics touched upon were
numerous, including healthcare when travelling abroad, roaming charges, the
tobacco saga, residence scheme, the sale of Maltese citizenship, immigration,
animal rights, voting for blind people, GMOs, etc…

The Commissioner explained that it is important to
distinguish between what is of Europe and what is of the Member State.
Sometimes we blame the EU for things that are of the competence of the
Governments. Do we want more Europe or less Europe? People's perception changes
according to the circumstance. When everything is going well we feel we do not
need Europe and want to be left on our own and do not feel the need to help our
fellow member states that are going through difficult times. On the other hand
when crises hits or when a particular problem arises we critises the EU for not
doing enough and not having more powers in certain areas.

We sometimes forget why the EU exists and we become
skeptical if we need it. We forget what there was before the European structure
was set up. The EU does not only helps us to cooperate towards greater good and
prosperity instead of fighting each other. Other than the practical benefits
that come with joining the EU there is great added value such as security and
solidarity. Due to the fact that people forget why we need Europe they do not
see the need for solidarity and this is an effort everyone has to make to help
citizens understand that solidarity is in everyone's best interest as we are
one Europe.

Do citizens feel their voice is being heard? Malta
always scores above the EU average for questions like this. Since Lisbon the
European Citizens have gained a new voice through the European Citizens'
Initiative. Through this initiative citizens can put items of common concern on
the EU agenda.

When asked how they see the EU in the next 10 years,
the panel of speakers – European Commissioner Tonio Borg, Head of the
Commission Representation in Malta Martin Bugelli and Head of the EP
Representation in Malta Peter Agius – all were very positive. All see the EU
doing well, even better than today, they see a larger Europe and an inclusive
one where citizens are at its heart. Commissioner Borg stated that Malta will
continue advancing in the EU and continue increasing its influence, further
overcoming our smallness.

The Commission
has published practical guidelines to prepare businesses for the new VAT rules
for telecoms and e-services, which will enter into force in 2015. The aim is to
help businesses to be fully prepared on time for the change-over, whereby VAT
will be charged where the customer is based, rather than where the seller is. A
One Stop Shop will enable telecoms, broadcasting and e-services businesses
comply with all of their VAT obligations in all Member States from their
country of registration.

The Guidelines can be
found:

http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/how_vat_works/telecom/one-stop-shop-guidelines_en.pdf

The
standard VAT return – which will replace national VAT returns – will ensure
that businesses are asked for the same basic information, within the same
deadlines, across the EU.

Every
year, 150 million VAT returns are submitted by EU taxpayers to national tax
administrations. Currently, the information requested, the format of national
forms and the reporting deadlines vary considerably from one Member State to
the next.

This
makes VAT returns for cross-border businesses a complex, costly and cumbersome
procedure.

Businesses
operating in more than one Member State have also complained that it is
difficult to remain VAT compliant, due to the intricacy of the process.

This
proposal is also an important contribution to creating a more efficient and
more fraud-proof VAT system, as set out in the Commission's Strategy for VAT
reform. VAT accounts for around 21% of Member States revenues, and yet around
€193 billion went uncollected in 2011. By creating an easier system for both
taxpayers and administrations to work with, the standard VAT return can improve
tax compliance and reduce the VAT Gap. As such, today's proposal could make an
important contribution to fiscal consolidation across the EU by increasing
income to the public purse.

The objective
of this consultation is to gather views in particular on the extent of the
problem of labelling of leather products and the relevance and impacts of
proposed options.

Objective of the consultation

The
problem may arise not only from products that are fraudulently labelled as
leather or are counterfeit but also from products that are labelled with the
term ‘leather' (e.g. ‘eco-leather', ‘synthetic leather') and may induce the
consumer to think that they are of animal origin. Misleading and fraudulent
labelling are not only detrimental for consumers but also for businesses.

The
consultation covers all leather products (leather being a material of animal
origin) and products which have the aspect of leather but are made of other
materials. Since the labelling of leather shoes is already regulated by Directive
94/11/EC (Footwear Directive), shoes are excluded from the scope of this
consultation.

This
consultation will feed into an on-going impact assessment procedure, with a
view of a possible proposal of the Commission on an authenticity leather
labelling system at EU level.

In order
to prepare your answers, a printable pdf-version of the survey can also be
downloaded using the link below.

http://ec.europa.eu/eusurvey/runner/74d5e248-a4c3-7032-5c09-42e5fd784749?surveylanguage=EN

Once completed,
it can be sent at:

"Participating
in International Tenders" – Date: 21 November 2013  – Venue: Smart City, Malta – This
aims to provide more information to local SMEs on what it entails to be active
on the international market through the submission of tenders.  

International and national expert speakers
will provide an overview of the legislative framework of EU procurement rules,
together with tips and best practices that should be taken note of prior to
submitting a bid.

"The
Power of Being Small"

Date: 22 November 2013  

Gozo [venue to be confirmed]

This
conference that will not only address today's challenging realities faced by
micro and small business entities but will also present the opportunities that
can still be exploited by such entrepreneurs. 
Various tools, like creative thinking techniques and cooperation
databases, together with other EU Funding Programmes, at the disposal of these
businesses, will be outlined and discussed by expert speakers.

"Managing
IPR for your business in China"

Date: 28 November 2013   l    
Venue: Malta Enterprise offices, Pieta'

This half-day event is being held for those enterprises that are
interested in carrying out business with Chinese SMEs.  Representatives from the China IPR SME
Helpdesk and the EU SME Centre in China shall be delivering presentations.
These two entities are both involved in helping SMEs facilitate their access to
the Chinese market by offering professional information and confidential advice
through their vast portfolio of services. 
Presentation topics will include:

 To register for these events or for more details kindly send an email to
: