The
frustration of having been in government for 17 years with so little to show for
it often surfaces in the discourse of government politicians. They are in power.
They have been in power for an inordinately long time. And yet they are
constantly humiliated in being unable to achieve their targets. The lack of
enforcement is Malta's prime environmental malady.
Everybody has been
blamed. Ministers have lambasted the civil service. The creators of the Malta
Environment and Planning Authority and its Planning Authority predecessors have
ripped it to shreds in their frustration. Ordinary citizens have been described
as arrogant, impertinent and undisciplined. One outgoing President claimed that
the Maltese did not care for their environment while another excused his
failings as a minister by blaming a civil service that often defeated
him.
The most frustrating obstacle to the executive is the judiciary. It
has to be. That is what it is there for in the system of constitutional checks
and balances. Some of us still remember the destructive tug-of-war between the
two in the 1980s. It appears to be still going on. In recent years a Minister of
Justice lambasted the courts as if he had no hope of reforming the system to
make it function properly.
Under a PN government we have less spectacle
but the assault on the basic rights of citizens goes on nonetheless. It was with
no small satisfaction that I read the comments of the Chamber of Advocates on
the infamous Bill 27 through which the government proposes to short circuit the
judicial system in the recovery of debts up to Lm5,000. My very serious
misgiving had the comfort of theirs.
A closer look at Bill 28 on
eco-contributions made me forget what I was looking for. Never mind the 10c tax
on batteries and the Lm12 tax on fridges. The enforcement provisions make the
eco-tax misnomer a very small matter indeed.
The government's frustration
has led it to legislate in a stunningly authoritarian fashion. Every eco-fascist
would be proud. I am not an eco-fascist and stand appalled by some of the
proposals.
The minister responsible is authorised to impose fines of up
to Lm30,000 or Lm200 per day by regulation to be made in future with little or
no parliamentary scrutiny. The Act will be administered by a competent
authority, presumably WasteServ Ltd, with the help of the VAT Department and the
police which will be empowered to enter any premises and seize and copy any
documents. In determining and imposing penalties WasteServ Ltd will not suffer
the restraint of any court issuing precautionary warrants. Notice of a penalty
imposed immediately constitutes executive title presumably in favour of
WasteServ Ltd.
For anybody convinced that loud whip cracking is the only
solution to Malta's environmental problems, Bill 28 may sound like a dream come
true. Not for me. The whip cracking precedes any serious attempt to create the
necessary environmental awareness for the population to internalise the values
on which such legislation should be based. There are no carrot, only whips. It
is a recipe for resistance, for deep and abiding resentment.
Providing
the government with big guns is one thing. Providing them to a government quango
is quite another. I am not at all happy about the idea that the WasteServ
chairman may substitute the judicial system and also absorb the minister's
residual executive powers as well. The whole constitutional edifice is beginning
to change shape. The separation of powers has become an obsolete idea.
WasteServ's chairman is to become prosecutor, judge and jury for so-called
administrative offences which carry penalties far beyond those imposed for very
serious crimes.
There is also the somewhat novel offence related to
withholding information from WasteServ Ltd. Anybody doing so willfully or
maliciously is liable to a fine of Lm500. Never mind the right of the accused to
remain silent. The accused has an obligation to prove the prosecution's
case.
In an ideal world all such powers would serve only to scare the
living dayligthts out of people to ensure compliance. This is not an ideal
world. WasteServ's present chairman, Nick Degiorgio, may be a very nice person
with a refined sense of fair play. He will not always be chairman of the
competent authority, WasteServ Ltd. The Eco-contributions Act may end up doing
much more than scaring people.
Having lived through a time when all sorts
of laws were abused to make people's lives hell, I am extremely suspicious of
any legislation that depends of the sense of fairness of its users to achieve an
acceptable result. The Eco-contribution Act is a lethal weapon in the hands of a
government wishing to put anybody out of business. Malta is a country with a
significant history of law becoming a means of oppression. When are we going to
wake up to the dangers of trusting the government always to behave decently? No
such guarantee exists except by preventing the accumulation of such powers and
ensuring the safeguard of due process through a judicial system that
works.
Dr Vassallo is chairman of Alternattiva Demokratika – The Green
Party.
Exhibitors at the International Trade Fair, which closed
last weekend, reported bad sales all around.
These reports ranged from
the car importers to the white goods exhibitors.
GRTU has conducted its
second survey among the trade fair exhibitors, which are mainly represented by
the organisation. The survey focused on the general outcome of trade fair
operations. Businesses were asked to comment on their overall performance and
opinions.
58 per cent of those interviewed reported a decrease in sales
turnover compared to last year. Of these, 52 per cent claimed that they had a
drop of over 20 per cent. Only 14 per cent had sales improvement while 28 per
cent estimated similar performance compared to last year.
Only 22 per
cent managed to achieve the turnover they expected. 57 per cent said that they
actually did worse than expected.
Meanwhile, 44 per cent registered sales
improvement during the second week over the first week. 40 per cent recorded the
same turnover as the first week with 16 per cent claiming a
decrease.
Those who noted that visits to their stands increased compared
to last year amounted to 26 per cent only. 45 per cent noted a
decrease.
83 per cent think that the dates chosen for the trade fair are
appropriate yet 52 per cent are also of the opinion that minor but specialised
Fairs held throughout the year are affecting the overall performance of the
general Trade Fair.
Nevertheless, 66 per cent think they will participate
again in next year’s fair with 28 per cent are still unsure. Of those who will
not participate again or still unsure, 50 per cent admitted that they are not
recuperating costs. However, some comment that exposition in the trade fair is
paramount if one wants to survive competition.
As a general comment, the
trade fair used to attract far more people and generate far more business in
past years when the price reductions used to happen only at trade fair time and
when these were considerable. These days, there are sales going on all the time
and many so-called trade fair reductions are not perceived to be real reductions
at all.
Mainly, however, it all points out to people being far more
careful with their money, with many jobs being under threat and with people
generally being far more careful about the way they spend their money.
B’referenza ghal-istqarrija li l-Msiehba Socjali flimkien
mall – Korpi Kostitwiti u Trade Unions – membri tal-Kusill Malti ghall-Izvilupp
Ekonomiku u Socjali (MCESD), l-GRTU – Malta Chamber of Small and Medium
Enterprises tiddikjara li taqbel u tassoccja b’mod assolut ma dak li qed tghid
l-istqarrija tal-Msiehba Socjali.
L-unika raguni li r-rapprezentant
tal-Kunsill Ezekuttiv tal-GRTU d-Direttur Generali Vince Farrugia ma kienx
prezenti waqt il-laqgha tal-Msiehba Socjali kien ghaliex Vince Farrugia kellu
jattendi ghal-laqgha mall-Prim Ministru f’Kastilja fejn f’isem l-GRTU kien qed
jesprimi lill-Prim Ministru l-istess messagg li ghaddew l-Imsiehba
Socjali.
The upcoming eco tax on a wide range of
products is expected to affect the Maltese economy with the highest increase in
the Retail Price Index this year. While Prime Minister Lawrence Gonzi
reassures businesses and consumers that the new tax “would only have a minimal
effect of 0.84 of a percentage point on the Retail Price Index”, this would
still mean the highest increase to be registered this year after a brief drop
registered last May.
According to the National Statistics Office, RPI
increased slightly in February over January by 0.03. In March there was a 0.43
increase over the previous month, rising to another 0.66 increase in April, and
going down by 0.19 in May.
If the prime minister’s estimates are correct, a
0.84 rise in the RPI would be the highest increase this year.
Despite, the
drop, the retail price registered last May was still 2.40 more than that
registered in May 2003, putting a 0.84 increase as much as a third of the rise
registered in one year.
The plan is already under fire by the General
Retailers and Traders’ Association (GRTU) and the Federation of Industry, who
maintain that the taxes are untimely and would adversely affect consumers’
purchasing power.
“We’re inundated with taxes that are supposed to go for the
environment, this is not the time to impose new taxes,” GRTU Director General
Vince Farrugia said. “This has nothing to do with packaging and the government
just wants to add to the existing tax burdens, over and above VAT. If the
government was really interested in collecting environmental contributions, then
it should modernise existing taxes and remove taxes on those products that are
environmentally friendly.”
The taxes will come at a time when the economy is
slumbering and VAT has just been increased from 15 to 18 per cent.
The GRTU
Trade Fair Survey showed that 58 per cent of trade fair exhibitors interviewed
reported a fall in sales turnover when compared to last year. Of these, 52 per
cent claimed that they had a drop of over 20 per cent in their sales, while only
14 per cent had sales improvement over last year’s. Fifty-seven per cent said
they did worse than expected.
Economics Professor Edward Scicluna warns that
the new taxes will inevitably lead not only to less spending by consumers but it
also reduces the overall economic activity, despite Gonzi’s reassurances that
the taxes “would only have a minimal effect of 0.84 of a percentage point on the
Retail Price Index”.
“0.84 per cent on the Retail Price Index is a lot,” says
Prof. Scicluna, “not so much because it increases inflation, as many people
wrongly think, but because increased taxes actually lead to deflation. The
average wage earner’s consumption expenditure is going to be hit by about just
under one per cent. The negative multiplier effect of the cut in one’s income is
definitely deflationary. It reduces economic activity. Private consumer
expenditure which is a major component of GDP is reduced by a multiple of that
percentage point. Unless of course it is not an income compensated price change,
where the proceeds (that is revenue) are given all back to the
taxpayers.
“These taxes definitely come at the wrong time. It’s very bad to
introduce them at this point in time when no businessman or consumer affords to
hear there will be more taxes imposed. It would be an ideal situation for a
civilised and industrialised country to have eco taxes, in order to discourage
polluters. If the government was only interested in promoting eco-friendly
consumption then it would incentivise consumers to buy environmentally friendly
products and dissuade them from buying the ‘bad’ products. This could be done by
an appropriate change in the relative price ratios, keeping the overall price
index unaffected.”
The government plans to garner revenue of around Lm4
million annually from the new taxes, which will serve to finance
Wasteserv.
L-imsiehba socjali kollha kemm huma qeghdin isemmghu lehinhom
f’vuci wahda: li l-Prim Ministru Lawrence Gonzi m’ghandux ikompli jwebbes rasu u
jimplimenta t-taxxa ambjentali minghajr konsultazzjoni adegwata mas-shab
socjali. Il-Gvern akkost ta’ kollox irid li din it-taxxa tiddahhal fl-1 ta’
Awissu li gej.
Nhar l-Erbgha wara nofs in-nhar, il-Prim Ministru Lawrence
Gonzi sejjah laqgha urgenti mas-shab socjali f’Kastilja. Din il-laqgha bdiet
fl-4.00 p.m. u damet saghtejn.
Madankollu l-imsiehba socjali xejn m’huma
kuntenti bir-rizultat ta’ din il-laqgha, ghax minkejja li ghamlu madwar saghtejn
jiddiskutu, il-Gvern xorta wahda, l-Erbgha fil-ghaxija stess u sahansitra
l-bierah fil-ghodu u fil-ghaxija, baqa’ ghaddej qiesu ma gara xejn u kompla
jiddiskuti l-Abbozz ta’ Ligi dwar din it-taxxa fil-Parlament.
F’kummenti
lil l-orizzont, l-ghada tal-laqgha ta’ nhar l-Erbgha mal-Prim Ministru, Tony
Zarb, is-Segretarju Generali tal-General Workers’ Union sostna li “ghamilniha
cara hafna ghall-Prim Ministru li l-GWU qieghda tara din it-taxxa xejn hlief
aktar pizijiet godda fuq il-haddiema u l-pensjonanti. Jekk veru l-Gvern
jirrispetta lis-shab socjali ghandu jisma’ mis-sinjal car li qeghdin jaghtuh.
Dan is-sinjal huwa: IEQAF U TKOMPLIX TWEBBES RASEK.”
Tony Zarb zied jghid
li fil-laqgha ta’ nhar l-Erbgha, kulhadd esprima l-istess pozizzjoni li
m’ghandhiex thalli triq ohra hlief dik li l-Gvern jieqaf milli jkompli ghaddej
bil-ligi u jiddiskuti mas-shab socjali, biex wara li jigi idendifikat l-impatt
fuq il-haddiema, il-pensjonanti u anki min ihaddem, b’mod immedjat ikun hemm
ir-rimedji.
Huwa qal ukoll li l-haddiema, il-pensjonanti u l-familji
taghhom ma jistghux jerfghu l-pizijiet ta’ din it-taxxa u dan ghax digà qeghdin
jerfghu hafna pizijiet ohrajn. Semma fost l-ohrajn iz-zieda ta’ 3% fil-VAT u
zidiet li kien hemm fil-petrol, id-diesel u l-pitrolju.
“Dan il-kaz
ghandu jservi biex il-Gvern jinghata sinjal car mis-shab socjali li spicca
z-zmien li jibqa’ jittrattahom bhala tal-konvenjenza. F’kaz li l-Gvern jinjora
dak li qeghdin jghidulu s-shab socjali, ikun ifisser li qieghed bl-agir tieghu
jimmina il-kuncett ta’ shab socjali. Ikun inutli wara li l-Gvern jipprova
joqghod izieghel bis-shab socjali biex min-naha taghhom dawn ikomplu jiddiskutu
diversi problemi li ghandu l-pajjiz, liema problemi zgur ma kinux is-shab
socjali li ghabbew lill-pajjiz bihom,” qal Tony Zarb.
Huwa kompla jishaq
li “min-naha taghna, bhala union, se nkomplu naghmlu l-pressjoni biex dak li
ddecieda l-Kunsill Nazzjonali tal-GWU jigi attwat u issa sta ghall-Gvern liema
diska jdawwar – jew dik li jsib is-soluzzjonijiet kif qeghdin jindikawlu s-shab
socjali, jew id-diska l-ohra, dik tal-konfrontazzjoni u l-arroganza.
“Li
nghid biss huwa li l-GWU se tkun b’ghajnejha miftuhin berah ghal dak kollu li
jkun qed isehh, biex imbaghad tiehu l-pozizzjonijiet taghha fl-interess
tal-haddiema, il-pensjonanti u l-familji taghhom. Kieku l-Gvern ried jara kif se
jirranga l-ambjent, flok ma mpona din it-taxxa messu ha l-inizjattivi li
ncentiva lil dawk ic-cittadini u jhajjarhom biex jaghmlu uzu minn oggetti
‘eco-friendly’.
F’kummenti wkoll lil dan il-gurnal, Gejtu Vella,
is-Segretarju Generali tal-Union Haddiema Maghqudin (UHM), sahaq li l-union
ghamlet il-pozizzjoni taghha wahda cara lill-Gvern – li “jipposponi l-ligi halli
l-ewwel issir diskussjoni serja ma’ l-imsiehba socjali fl-MCESD. Il-ballun issa
jinsab f’saqajn il-Gvern. ”
Gejtu Vella qal li bhala
union,
“ninsistu wkoll li din l-eko-kontribuzzjoni jew taxxa ambjentali,
sejhilha kif trid, se ggib piz gdid fuq il-familji Maltin u Ghawdxin. Nhar
it-Tlieta kellna laqgha mal-Ministru George Pullicino u mas-Segretarju
Parlamentari Tonio Fenech fejn ergajna ghamilna l-pozizzjoni taghna cara u
ghamilna l-istess haga fil-laqgha ta’ nhar l-Erbgha, dik id-darba quddiem
il-Prim Ministru Lawrence Gonzi, il-Ministri George Pullicino u Austin Gatt u
mas-Segretarju Parlamentari Tonio Fenech.
“Il-pozizzjoni taghna hija cara
u jekk il-Gvern jaghmel li jrid, imbaghad wara naghmlu dak li hu mehtieg ahna.
Irridu konsultazzjoni vera u ghalhekk ninsistu li l-implimentazzjoni ta’ din
it-taxxa tigi posposta.”
Min-naha tieghu, id-Direttur Generali tal-GRTU,
Vince Farrugia, sahaq ma’ l-orizzont li “allahares Lawrence Gonzi jigi jaqa’
jqum minn kulhadd u jibqa’ ghaddej meta jaf li kulhadd huwa kontrih. Din il-haga
qatt ma grat fil-pajjiz li l-Gvern kellu lil kulhadd kontrih – is-shab socjali,
l-unions, l-ghaqdiet tal-konsumaturi u anke l-ghaqdiet ta’
l-ambjent.
“Nemmen li Lawrence Gonzi jifhem u ghalhekk nemmen li mhux se
jaghzel it-triq tal-konflitt. Jekk il-ligi tigi posposta hadd ma
jbati.”
Vince Farrigia zied jghid li Lawrence Gonzi m’ghandux ikompli
jwebbes rasu. Kulhadd jaf li l-ligi ghandha tigi posposta u ssir diskussjoni
serja. Huwa spjega li l-bicca l-kbira ta’ Lm4 miljun li se jdahhal il-Gvern minn
din it-taxxa ambjentali se jdahhalhom mill-grupp zghir ta’ negozjanti. Il-GRTU
qieghda tistenna li l-Gvern inehhi l-ingustizzja kbira li ghamel fuq kulhadd,
meta issa jrid lin-negozjanti jibghatulu cekkijiet ta’ eluf kbar ta’ liri
minhabba li jridu jhallsu t-taxxa fuq l-istokks li ghandhom, li huma prodotti li
ghadhom ma bieghux.
Jekk jigri dan, il-Gvern se johloq zieda fl-ammont
ta’ nies bla xoghol ghax in-negozjant ikun kostrett jkecci lill-impjegati tieghu
ghax ma jkunx jiflah ghal dan il-piz gdid.
“Din it-taxxa l-gdida ta’
l-ambjent mhux veru giet miftehma ma’ l-imsiehba socjali fil-laqgha li saret
qabel il-Budget tas-sena l-ohra f’Ghawdex. Dak in-nhar konna tlabna kjarifiki
fuqha u r-risposta li nghatajna mill-Gvern kienet li din m’hix se tidhol qabel
ma jintlahaq ftehim.
“Izda sirna nafu bit-taxxa permezz ta’ abbozz li
gie ppubblikat fil-Gazzetta tal-Gvern tliet gimghat biss qabel ma habbarha.
Ghalhekk mahruqin wahda nobis ghax il-Gvern haseb li se jigbor balla liri minn
fuqna u jhabbarhom fil-budget li gej, meta din it-taxxa qatt ma kienet diskussa.
Il-paniku tal-Gvern mhux veru huwa biex jibza’ ghall-ambjent, imma biex jigbor
il-flus qabel il-budget,” sostna Vince Farrugia.
Anton Borg, il-President
ta’ l-FOI, ukoll kien ta’ l-istess fehma li Lawrence Gonzi m’ghandux ikompli
jwebbes rasu. “Fil-waqt li bhala employers m’ahniex inkwetati li din il-ligi se
tghaddi mill-Parlament ghax il-Gvern assigurana li wara li l-ligi tghaddi
mit-Tieni Qari, jekk ikun hemm problemi se jwaqqaf kollox fl-istadju
tal-kumitat, m’ahniex kuntenti xejn bl-ezitu tal-laqgha ta’
l-Erbgha”.
Sadanittant ghal mistoqsija ta’ l-orizzont qabel il-laqgha ta’
nhar l-Erbgha dwar it-talba ta’ l-imsiehba socjali biex il-process li se jdahhal
fis-sehh din it-taxxa jigi pospost hix gustifikata, il-Ministru ghall-Affarijiet
Rurali u Ambjent George Pullicino wiegeb li “fl-opinjoni tieghi,
il-konsultazzjoni saret u ghadha ghaddejja. Le, m’hemmx raguni ghaliex inwaqqfu
d-diskussjoni fil-Parlament. Fl-opinjoni tieghi, il-pozizzjoni tal-Gvern hija
cara – hemm bzonn nigbru l-flus biex ninvestu fl-affarijiet li hemm bzonn
naghmlu.”
George Pullicino kompla jishaq li hadd ma jiehu gost imur
il-Parlament u jipproponi zidiet, imma l-verità hija li jew nibq-ghu nidhku
b’xulxin u nghidu ghandna pjan u dak il-pjan jibqa’ fl-arja, jew inkella rridu
nsibu l-mezzi li l-inqas iweggghu lin-nies.
“Stajna ghamilna mod iehor.
Stajna qbadna u qsamna l-ispiza fuq kull bieb u dar u fuq kull familja ndaqs.
M’ghamilniex hekk. Ippruvajna mmorru lejn sistema li tindirizza l-gbir tal-flus,
imma tindirizza wkoll l-idea li inti tbiddel it-tendenzi fil-konsum.
“Mhux necessarjament is-soluzzjoni perfetta. Lesti nkomplu niddiskutu
anke wara li l-ligi tghaddi biex nirfinaw l-affarijiet, imma dan il-pajjiz
ghandu bzonn li jaghmel il-bidu.
“U dan il-bidu rridu naghmluh illum
qabel ghada jekk ma rridux li nibqghu bil-problemi tal-qasam ta’ l-iskart li
ghandna llum li hafna drabi hallejnihom taht it-tapit u li hemm bzonn naghmlu xi
haga dwarhom,” kompla jghid il-Ministru Pullicino lil
l-orizzont.
X’irid jimponi
l-Gvern…
– Fliexken u bottijiet tax-xorb maghmulin mill-Hgieg, plastik
jew metall – 1c fuq kull flixkun jew bott li jkun fih xorb mhux alkoholiku (bhal
‘soft-drinks’ jew ilma) u 5c fuq kull flixkun jew bott li jkun fih inbid jew
xorb alkoholiku.
– Prodotti kozmetici bhall-fwejjah u make-up – 5c fuq
kull prodott.
– ‘Tyres’ ta’ vetturi u muturi – Lm2 kull ‘tyre’.
–
Batteriji – 10c fuq kull batterija normali (minn dawk li normalment jintuzaw
fid-djar jew fl-ufficini) u 70c fuq kull batterija tal-karozzi.
– Zjut –
10c fuq kull litru ta’ zejt uzat fil-karozzi u 5c fuq kull filter
taz-zejt.
– Apparat domestiku – Lm12 fuq kull apparat li jkessah
(‘fridges’ u ‘air-conditioners’); Lm3 fuq kull oggett li jsahhan l-ilma
(bhall-‘geysers’); Lm5 fuq kull television jew monitor (mhux akbar minn 28
pulzier); Lm15 fuq kull television jew monitor (akbar minn 28 pulzier); Lm2.50
fuq kull apparat tat-telekomunikazzjoni (bhat-telephones u mobile phones); Lm10
fuq kull apparat li jintuza ghall-hasil u t-tisjir (bhall-‘washing machines’ u
‘cookers’).
Government
euphemistically calls it ‘eco contribution,’ but Karl Schembri says it is a
blanket tax that has little to do with environmentally friendly consumption
It had to be announced after the Trade Fair. When else could the Prime
Minister announce such wide-ranging taxes to be imposed on almost all kinds of
home appliances, telephones, televisions, batteries, tyres, cans, bottles and
toiletries?
By the end of August reality will hit us hard; Prime Minister
Lawrence Gonzi is keen on getting this ‘Eco-Contribution Act’ passed through
Parliament as soon as possible. Far from limiting itself to encourage consumers
to buy environmentally friendly products with recyclable packaging, the new law
has an 11-page long schedule in fine print, giving a whole list of products that
will be taxed from next month, over and above existing taxes. And the really bad
news is that for a great number of the products listed in that schedule there is
no alternative at all, eco-friendly or otherwise.
Take washing machines and
cooking appliances for example: all washing machines, dishwashers, microwave
ovens, gas ovens and electrical ovens will cost Lm10 more thanks to this
‘eco-contribution.’ No discrimination in favour of efficient, greener technology
here – just a blanket tax of Lm10 on all washing and cooking appliances.
The
same with fridges, freezers and air conditioners. All cooling and refrigerating
equipment will be taxed Lm12 more, irrespective of their energy efficiency.
Televisions and monitors will be taxed between Lm5 and Lm15, depending on their
size, while all kinds of mobile phones, land phones, and any other
telecommunications equipment will be carry an additional tax of Lm2.50. Car
tyres will be taxed an additional Lm2 while all toiletries and cosmetics,
irrespective of their packaging, will be taxed at 5c. Just in case you thought
that was a long list, the Prime Minister also informed us this was just the
first phase in a series of goods to be taxed in the name of the
environment.
That is rich coming from the party that attacked the European
Greens for being pro-eco taxes on tourism. Tonio Borg was the author of the
misplaced criticism as Alternattiva Demokratika has made it clear that it was
not pushing for taxes on tourism but shifting taxation from labour to
pollution.
“It is ironic that government is introducing eco-taxes so soon
after the scaremongering made by the Nationalist Party in the EP election
campaign mentioning eco-taxes as a reason why not to vote Green,” AD Chairperson
Harry Vassallo says.
Lacking legitimacy
It is immediately clear that
the way the law is being introduced lacks legitimacy in the eyes of the already
heavily burdened taxpayer. Even the political party most enthusiastic about
environmental taxes is attacking the government about the way it is imposing
this blanket tax over and above existing tax burdens.
“Eco-taxes were
mentioned in the 2004 budget and our comment at the time still holds true: we
welcome the introduction of eco-taxes, but not as an excuse for an increase in
taxation,” Vassallo says.
“Greens have advocated a shift of taxation from
taxes on labour to taxes on consumption; that is not an increase but a shift to
encourage employment. The term eco-tax should also imply a strict hypothecation
of taxes whereby the revenue collected is strictly dedicated to the targeted
environmental issue and is to be reduced or eliminated once the matter is
brought under control through a wider compliance.”
The idea of eco-taxation
is to use fiscal measures to encourage customers to buy environmentally friendly
products or those which have recyclable packaging and will be recycled. Eco-tax
schemes vary from country to country, but the principle usually adopted is that
the more environmentally unfriendly the package, the higher the tax to be paid.
Green tax reforms imply not only the introduction of particular ‘eco-taxes,’
but also the removal of other taxes that have damaging effects on the
environment. Also, eco-taxes are best compensated through the reduction of
existing distortionary taxes such as income and labour taxes.
But this
government is turning out to be a champion at making what could be just and
equitable taxes instantly unpopular. Such as was the case with VAT. And
means-testing of health care is on the way, just in case you
forgot.
Untimely and unplanned
If we had to put the economy aside for
a moment, what is most striking about this heavy-handed tax hike in the name of
the environment is the government’s hasty, last-minute approach to it all.
It
reflects bad planning, political aloofness and crass incompetence. Just imagine
if this government (make no mistake, it’s been in power since 1987) had to
consistently follow up its early sporadic, unpretentious yet successful
campaigns in the nineties: Xummiemu and popular educational campaigns on
pollution, collection of used batteries, waste separation. By now, a decade
since those campaigns were launched, and abandoned, environmentally-friendly
patterns of consumption would have become second nature to a great part of
society, at almost no cost at all. Instead, Xummiemu is dead and decaying at
Maghtab and the infamous waste separation exercise was found to be a farce:
people were separating their waste only to get it mixed again at the Maghtab
rubbish dump.
All the stakeholders involved are slamming the government for
its hasty, untimely plans. Sources at Federation of Industry say the government
expected their commitment on the new taxes before even showing them the proposed
Bill; GRTU weren’t even given a copy; environmental NGOs and consumer
associations weren’t even consulted.
As if to prove that it was a
panic-driven decision, the press conference itself that was meant to announce
the upcoming taxes turned out to be somewhat of a mess. It was scheduled to take
place at the environment ministry last Tuesday at 9.30am, to be addressed by
Environment Minister George Pullicino and Parliamentary Secretary for Finance
Tonio Fenech.
At the eleventh hour, some bright mind at the Prime Minister’s
office (or was it at l-Istamperija) must have realised the national importance
of the Bill, and also Gonzi’s essential input in his dual role as finance and
Prime Minister. At 1.20am last Tuesday, someone from the Department of
Information was instructed to inform the press by e-mail that the press
conference would be staged in Castille, half-an-hour earlier, to be addressed by
the premier.
Resistance to new taxes
On the previous day, GRTU and FOI
had pre-empted Gonzi by warning him they were against any new taxes,
particularly at this dire economic moment.
“There is no way the government
will get our approval on this one,” GRTU Director General Vince Farrugia said.
“We have no problem discussing reforms to the fiscal structure which would be
lenient on environmentally friendly products and harder on the environmentally
damaging, but we won’t be rushed into anything that would increase burdens on
our economy.”
FOI was equally critical: “The federation has clearly stated to
the government that …[it] cannot agree to the implementation of any form of
additional tax. We strongly believe that taxation in Malta is too high […] The
Federation firmly believes that at no point did it give its official reactions
to, or issue any comments on, the proposed scheme.”
That was enough to
neutralise Gonzi’s attempts, on the following day, to rope in the FOI and GRTU
into the process of imposing these new taxes. The Prime Minister said the
government had consulted them and had heeded their advice to set up a Commission
that would assess the introduction of a system for collecting products for
recycling. The GRTU had already said it would not participate in any
smokescreens. FOI sources say Gonzi’s reference to the federation, trying to
imply its consent, was gratuitous and premature.
While it is crystal clear on
which products have to be taxed and by how much, the Bill stops short of stating
how the government intends to collect electrical and electronic waste, and what
incentives will be offered to get people to dispose of their goods at bring-in
sites. Importers and producers who take part in waste collection schemes would
be granted a reduction in the ‘eco-contribution’ they would have to make on the
products brought in to help in waste separation, but even here the government’s
plans are utterly vague and unconvincing. Also, while taxing consumers heavily,
the Bill does not tackle industrial pollution, nor does it introduce any water
and air pollution taxes.
With the FOI’s and GRTU’s express disapproval, it is
difficult to imagine what such a Commission that is already labelled as a
smokescreen can come up with.
Financing Wasteserv
Even more worrying
is the Prime Minister’s declaration that the revenue made from these new taxes
(Lm4 million annually, according to Gonzi) will go to finance Wasteserv.
Now
this is becoming a typical ploy by the Nationalist government: first it sets up
publicly-funded companies, agencies and authorities, and then it invents new
taxes (call them fees, contributions, whatever) to finance them. It is becoming
an exasperating exercise in imposing new taxes mid-year, between one budget and
another.
Wasteserv is not equal to environment. Wasteserv is just another
publicly-funded company that lacks civil service scrutiny and transparency.
There is nothing which guarantees efficient environmental spending. The Lm40,000
spent on the Environmental Impact Assessment for the landfills in Qrendi that
will never materialise is a case in point. Coupled with incompetent ministerial
interference, Wasteserv’s failure so far to meet waste management strategy
deadlines mean that it is in no position to impose any taxes before it gives
clear indications it is there to deliver.
Dwindling purchasing
power
Vince Farrugia tends to be dramatic in his resistance, but his point
about the sector to be worst hit by these taxes is factual. It is a classless
sector made of couples who are setting up house, who will have to pay additional
taxes on virtually every household appliance they buy, and the poor will pay the
same taxes. That is why Farrugia is calling it an “anti-social tax.”
Even
worse, the taxes will come at a time when the economy is slumbering and VAT has
just been increased from 15 to 18 per cent.
Published on the same day of
Gonzi’s announcement, the GRTU Trade Fair Survey showed that 58 per cent of
trade fair exhibitors interviewed reported a fall in sales turnover when
compared to last year. Of these, 52 per cent claimed that they had a drop of
over 20 per cent in their sales, while only 14 per cent experienced sales
improvement over last year’s. Fifty-seven per cent said they did worse than
expected.
“We’re inundated with taxes that are supposed to go for the
environment, this is not the time to impose new taxes,” Farrugia said. “This has
nothing to do with packaging and the government just wants to add to the
existing tax burdens, over and above VAT. If the government was really
interested in collecting environmental contributions, then it should modernise
existing taxes and remove taxes on those products that are environmentally
friendly.”
A key element of any form of environmental taxation is fiscal
neutrality, which means that the overall tax burden is not increased. With the
increased pressure to keep taxes low, any Green tax that is introduced solely as
a revenue raiser is inevitably bound to be regarded as unjust by the people, and
this threatens the credibility of any true Green taxes.
It is not only
business interest groups who are ringing the alarm about the government’s
untimely tax increases. Economics Professor Edward Scicluna warns that the new
taxes will inevitably lead not only to less spending by consumers but it also
reduces the overall economic activity, despite Gonzi’s reassurances that the
taxes “would only have a minimal effect of 0.84 of a percentage point on the
Retail Price Index.”
“0.84 per cent on the Retail Price Index is a lot,” says
Prof. Scicluna, “not so much because it increases inflation, as many people
wrongly think, but because increased taxes actually lead to deflation.
“The
average wage earner’s consumption expenditure is going to be hit by about just
under one per cent. The negative multiplier effect of the cut in one’s income is
definitely deflationary.
“It reduces economic activity. Private consumer
expenditure, which is a major component of GDP, is reduced by a multiple of that
percentage point. Unless of course it is not an income compensated price change,
where the proceeds (that is revenue) are given all back to the
taxpayers.
“These taxes definitely come at the wrong time. It’s very bad to
introduce them at this point in time when no businessman or consumer affords to
hear there will be more taxes imposed.
“It would be an ideal situation for a
civilised and industrialised country to have eco-taxes, in order to discourage
polluters. If the government was only interested in promoting eco-friendly
consumption then it would incentivise consumers to buy environmentally friendly
products and dissuade them from buying the ‘bad’ products. This could be done by
an appropriate change in the relative price ratios, keeping the overall price
index unaffected.”
The Alternattiva chairman says eco-taxation on packaging
could have been neutral had the government insisted with the EU on existing
bottles collection schemes.
“It is a matter of regret that the government did
not insist sufficiently to sustain the use of returnable bottles during
negotiations with the EU on the Packaging Directive,” Vassallo said. “If
distributors were obliged to collect and dispose of packaging, the sustained use
of returnable bottles would be assured and the importers of non-returnable
packaging would have to deal directly with the waste they create. A return fee
would have been tax neutral and would not be considered a burden on consumers
who have an enviable record of returning glass bottles.”
At a heated meeting
organised by the GRTU yesterday for its members, importers were told by
Parliamentary Secretary Tonio Fenech that they will be expected to pay the new
eco-contribution on items that are currently in stock. There was no love lost
between GRTU Director General Vince Farrugia and Fenech on the controversial tax
government intends to introduce by August. Farrugia charged government with
ignoring the social partners saying that the tax was an imposition.
Fenech
replied saying that government is still open to discussion but could not wait
for ever. He insisted that the eco-contribution was intended to partially
finance the cost of waste treatment and disposal.
Vince Farrugia opened the
meeting with a brief introduction that traced the reasons why the Malta Council
of Economic and Social Development was set up, highlighting the need for
government and the social partners to discuss issues of national importance
before implementation. He also said that in last year’s budget former minister
John Dalli had given the GRTU his word that the eco-taxes mentioned in the
budget speech were not to be immediate, but would be introduced gradually and
after wide consultation.
“Two weeks ago government sent for us in
separate groups and without presenting us with documentation explained the
eco-contribution. I immediately smelt a rat, it looked as if everything was
pre-planned (kollox mahdum bizzilla) and they gave us two days to hand in our
comments,” Farrugia said.
He warned that if government simply ignored the
social partners through sheer imposition they would lose trust in the process of
consultation, which has taken years to arrive at the stage it is today. “If the
social partners lose their trust in government it would be bad for the country,”
Farrugia warned.
Farrugia also accused government of being in a state of
panic and insisted that the self-employed were not to blame for the shortfall in
public finances.
In his explanation of how the eco-contribution is expected
to function, Parliamentary Secretary Tonio Fenech rejected the argument that the
tax was intended to raise revenue for government.
He insisted the environment
was of utmost importance to government and not going ahead with the
eco-contribution meant the country would have to create another Maghtab instead
of treating its waste according to European norms.
Fenech painstakingly
explained that an eco-tax that discriminated between environmentally-friendly
and harmful products could create a barrier to trade and thus create problems
with the EU Commission.
Answering questions from the floor the Parliamentary
secretary said that importers were expected to make an opening stock declaration
by 1 August on which the eco-contribution would have to be paid on the next VAT
return due.
Fenech argued against the introduction of a percentage
contribution rather than the stipulated flat rates saying that it would have
been harder to introduce a waste returnable scheme.
Pressed by an importer on
the imposition of the tax on current stock, Fenech admitted that no study was
conducted on the impact of the tax on the cash flow situation. He defended the
lack of study saying that stocking policies varied between companies.
“Do not
restrict us,” one importer told Fenech. “We want to invest and create wealth,”
was the plea of another GRTU member.
At the end, the meeting served little to
clarify particular concerns by different individuals. It seems that the details
of the eco-contribution are not yet clear giving Vince Farrugia additional fuel
to hit out at government for defaulting on meaningful
consultation.
The eco-contribution shall be due at the
time at which the products are “placed on the market”: (where “placed on the
market” means when a product is transferred from the manufacturing stage with
the intention of distribution on the market in Malta, or when a product is
brought into Malta with the intention of distribution on the market) Provided
that where products are placed under a customs procedure on entry into Malta,
placing on the market shall be deemed to take place when they leave the customs
procedure.
The conditions on which the contribution shall be chargeable
and the rate of the contributions to be adopted shall be those in force on the
date on which the products are placed on the market.
Recovery of
Waste
In cases of “recovery of waste” from products on which
eco-contribution is paid in terms of this Act, the producers of those products
may apply to the Competent Authority for a credit of the contribution paid
thereon, or part thereof, against eco-contributions which may fall due in future
in terms of such regulations as the Minister may prescribe.
(where “recovery
of waste” means the re-use, recycling or reclamation of waste or any other
process aiming to extract secondary raw materials or energy from such
waste)
Liability for payment of Eco-Contribution
The liability for
the payment of the eco-contribution shall lie with the producer. Where two or
more persons are liable for the payment of the contribution, their liability
under the Act shall be joint and several.
Time of payment of
eco-contribution
The eco-contribution shall be payable on a quarterly
basis in arrears on submission of the return relative to the preceding
quarter.
Power of the Minister to make regulations
The Minister
may make regulations for the better carrying out of the provisions of this Act
and such regulations may provide for the giving of a guarantee or other form of
security by producers in order to ensure the payment of the eco-contribution due
in terms of this Act, and the manner in which such guarantee or other security
may be enforced.
Enforcement and Sanctions
Any person who
contravenes or fails to comply with any of the provisions of this Act or of
regulations made thereunder shall be guilty of an offence, and shall be liable
to:
ï‚· a penalty of a fine (multa) not exceeding Lm5000; OR
ï‚· an amount
equal to three times the amount of the eco-contribution payable on the products
in respect of which the offence is committed, whichever shall be higher; OR
ï‚· to imprisonment for a term not exceeding six months; OR
ï‚· to both such
fine and imprisonment, in respect of any conviction.
Reasonable
excuse
An insufficiency of funds to pay an eco-contribution due shall not
constitute a reasonable excuse.
Right of Access
The Authority, or
any person appointed by it for such purpose, shall, upon the production of his
written authority and at all reasonable times, have the right to enter upon any
land, building or place for the purposes of inspecting any stocks, books,
records or documents, in order to ensure compliance with the provisions of the
Act.
Registration
Every producer must apply to the Competent
Authority on the prescribed registration form or on such other form approved by
the Competent Authority, within thirty days of entry into force of the Act or
within thirty days from the date on which a person becomes a producer in terms
of the Act, whichever is the later.
On registration, the producer must
inform the Competent Authority of his opening stock of products as at the date
of registration.
On registration, a registration number shall be assigned
to the producer.
Reporting
A producer shall submit to the
Competent Authority returns, on a quarterly basis, containing data:
(i) on
the volume of products brought into Malta or manufactured, as
applicable;
(ii) on the volume of products placed on the market during the
relative quarter;
(iii) on the eco-contribution payable thereon;
(iv) such
other information as may be required by the Competent Authority in such format
as shall be established by the Authority:
Provided that producers shall
be bound to submit the first return after the lapse of three months from entry
into force of the Act.
Records and statements
The producer shall
be required to:
(a) maintain, for all products of which he is or is deemed to
be a producer, accurate accounts and records of stock and product
movements;
(b) comply with all requests to monitor, check and produce for
inspection any accounts, records and any stocks of
products.
Wara li l-GRTU –
Malta Chamber of Small and Medium Enterprises, informat lill-Gvern li sal-lum
it-Tlieta 20ta’ Lulju 2004 l-Kabinet tal-Ministri ried;
ï‚· jew jispjega
car kif kien ser jigbor it-Taxxa l-gdida ECO –TAX ï‚· jew inkella jipposponi
l-imposizzjoni ta’ din t-taxxa mill-1 ta’ Awwissu 2004 li gej,
1.
L-Gvern issa ser jibghat lis-Sur Tonio Fenech, Segretarju Parlamentari
fil-Ministeru tal-Finanzi biex il-lum fil-laqgha li l-GRTU qed issejjah
ghan-negozjanti li n-negozju taghhom hu milqut min din it-taxxa huwa jghid car u
tond x’qed jippretendi l-Gvern minn dawn n-negozjanti.
2. Il-GRTU ssostni
li din mhiex ghajr taxxa ohra fuq il-konsum u tghid li hi taxxa li dahhlet bla
konsultazzjoni u b’affront lill-MCESD. Il-GRTU tghid li l-ghan principali ta’
din it-taxxa hu li l-Gvern jigbor aktar flus bl-iskuza tal-ambjent biex itaffi
ftit ghall-infieq bla razan tas-settur pubbliku.
3. Is-Sur Tonio Fenech,
hu mistenni jghid:
ï‚· jekk l-gvern hux qed jinsisti li n-negozjanti
jhallsu sa Ottubru t-taxxa dovuta fuq l-istocks kollha li ghandhom ï‚· b’liema
mod ser tingabar din it-taxxa, meta tingabar u fuq x’hiex hi dovuta
Il-Laqgha ser issir illum it-Tlieta 20 ta’ Lulju 2004 kif gej: Post:
Sala Marquis Scicluna Trade Fair Centre Naxxar Hin:
14.00hrs
