Alex Borg pledges 15% corporate tax for local and foreign businesses
Tax would apply to hospitality, catering and retail industries
A PN government would ensure that corporate tax for local and foreign businesses is harmonised at 15 per cent within the hospitality and catering industry, leader Alex Borg pledged on Sunday.
“In the coming weeks, I will be putting forward a proposal whereby, in certain industries such as hospitality, catering, and retail... the corporate tax will be 15 per cent for everyone,” Borg told party supporters in Qormi on Sunday.
Addressing a question-and-answer session, Borg said the current tax rates create “unfair competition” as local businesses pay 35 per cent while foreign businesses pay 5 per cent.
Last year, the Malta Development Association suggested that Malta’s corporate tax should be a flat 15 per cent rate for all businesses.
But Finance Minister Clyde Caruana had shot down this suggestion, saying it was in the country’s interest that the rates remain the same for now. In its electoral manifesto, the PL had pledged to reduce corporate tax for local companies to 25 per cent.
On Sunday, Borg also suggested reducing VAT for all restaurants: from 18 per cent down to seven per cent. Additionally, a system would be introduced linking card payments on ePOS machines to the tax commission. This would ensure the government received its tax dues.
The Association of Catering Establishments (ACE) has also suggested bringing down VAT for restaurants to seven per cent, arguing it would bring such establishments on par with a rate enjoyed by hotels.
Earlier this year, chef Rafael Sammut told Times of Malta there was a good chance that restaurants making a profit were "messing around with their VAT".
On Sunday, Borg touched on a range of issues - from tourism and culture to housing, family support, and the environment.
On tourism, Borg spoke about the quality of visitors Malta was attracting.
He referred to Ibiza, where, two years ago, the local government realised businesses were struggling despite high tourist numbers. The number of visitors dropped following a change in how the island was being advertised; however, local businesses thrived as visitors spent more money.
“We have one of the best cuisines in Europe. Let’s promote our gastronomy further,” Borg suggested.
He also proposed Malta strikes agreements with museums abroad to display international artworks at the country’s palaces.
Turning to health and the elderly, Borg stressed the importance of investing in preventive care and in carers.
“We want every town to have its own care home so that the elderly can live a decent life while being taken care of,” he said.
Borg meanwhile, addressed the difficulties young people face in buying their first homes. Instead of pushing them towards newly built apartments, he said there should be incentives for them to renovate vacant properties.
To support couples in having more children, Borg reiterated the PN’s proposal to grant new parents a year of leave, along with an €8,500 grant for those who have a second child.
On the environment, Borg said the Opposition has asked parliament to discuss its proposal for the right to the environment as an enforceable human right in the constitution.
He also reiterated his call to revise local plans. The Planning Authority's CEO, Johann Buttigieg, said that the revision of the local plans will "hopefully" start within the next two years.