SME Chamber

Pressure mounts for eco-tax postponement

current hot issue revolving around the introduction of the eco tax was high on
the agenda of both the government and the social partners

While Prime Minister Lawrence Gonzi was meeting with Chamber
of Small and Medium Enterprises (GRTU) director-general Vince Farrugia,
representatives of the social partners were discussing the issue in a meeting at
the Radisson in St Julian's.

A spokesman for the Prime Minister confirmed
that meetings were taking place between Dr Gonzi and the social partners as part
of the consultation process promised by the Prime Minister.

Questioned on
whether Dr Gonzi was considering postponing the implementation date of the
eco-tax, the spokesman said this would be considered if the extension was a
"decent" one.

He said the extension would be one involving a "small
number of weeks" meaning that the eco-tax would come into force in the second or
third week of August.

However, Federation of Industry president Anton
Borg said if the extension was one of a "few days" it might just as well remain
as it was.

On Friday Mr Borg met with the Prime Minister, and the eco-tax
was one of the issues on the agenda. He said Dr Gonzi had promised them an
answer about the way forward, and the social partners were awaiting

More meetings about the issue are expected to be held this week.
Originally, the eco-tax had to come into effect on August 1, but the social
partners are requesting a postponement while more consultation takes

The request for an extension was included in the discussion which
Mr Farrugia had with the Prime Minister. The GRTU director-general said the
chamber was suggesting that the eco-tax would come into force in January so that
business people would have time to deplete their stocks while consumers would
have more time to buy products at pre-eco-tax prices.

Mr Farrugia said
traders were not prepared to start collecting the eco-tax as from August 1. He
explained that the bill states that business people have also to pay the
government on their existing stock, but said traders were not prepared to send a
cheque to the government on this by October.

"This is impounding on
businesses' cash-flow," he said, adding that many traders were prepared to
challenge it.

Mr Farrugia said meetings this week would determine whether
there were grounds for an agreement to be reached about the

Another important issue discussed with the premier was the lack of
consultation that is irking the social partners. Mr Farrugia said the government
could not "throw away" the process of consultation that had been established
during the EU accession process.

"We cannot throw away what we had
striven to build in the name of public finances," he said.

Mr Farrugia
said his message to the Prime Minister was to refrain from turning his back to
this "new democracy", and reassure the social partners that this was not going
to happen.

He criticised the way the government had decided upon the
eco-tax without the type of consultation the social partners had got used

"The Prime Minister said he was prepared to go back to the Malta
Chamber for Economic and Social Development and fine-tune the eco-tax bill," he
said, adding that Dr Gonzi seemed "open to finding a solution".

He said
it was positive that dialogue was ongoing, and an attempt to find a solution
would take place over the next few days. He added that the tax posed a "big
burden" and it was imperative to discuss it.

He explained that it would
have an effect on the level of finances of businesses, and affect the consumer
through the new prices and the cost of living, and would eventually go back to
haunt the employers through requests for pay increases.

At the same time
that the meeting was being held at Castille, the claimed lack of consultation
was on the agenda of a high-powered meeting attended by the Chamber of Commerce,
the Federation of Industry, the Malta Hotels and Restaurants Association, the
Malta Employers Association, the General Workers Union, the Union Haddiema
Maghqudin and the Confederation of Malta Trade Unions.

The social
partners condemned the lack of consultation by the government before taking
decisions affecting both businesses and workers.

In a collective
statement, the social partners expressed their disappointment that the Malta
Council for Economic and Social Development was only serving as a smokescreen
instead of being a serious and structured forum where consultation and
constructive discussion in the national interest took place.

They said
the eco-tax introduction was a prime example of a law which was being pushed
forward by the government without consultation with the social

"This can no longer be tolerated," they said, and insisted on
an urgent MCESD meeting to establish clear and concrete procedures so that the
consultation principle would not remain a frivolous concept, but a system
through which the country could really move forward.

"The MCESD work can
no longer be undermined, but should be given the dignity it deserves," they
said. The organisations stressed that because of the importance of the issue,
the Prime Minister should be present for the meeting".

Mr Farrugia said
the GRTU endorsed the statement by the social partners.

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