The suggestion by Labour leader Joseph Muscat for the capping of the maximum amount the government could get from excise and Customs duty on petroleum products was timely and necessary, Charles Mangion, the MLP's spokesman for finance, said yesterday.

Revenue netted from such taxes rose from €60 million in 2005, to €66 million in 2006 and to over €95 million last year, Dr Mangion added.

Between 2006 and 2007, from excise duty alone the government netted an extra €30 million. This reflected an increase in consumption and some changes in the rate of excise that was due, apart from the fact that the rise in duties was mirrored in price hikes.

The aim behind the capping is to prevent prejudicing government income and grant a breathing space to families and industry at a time when higher prices were seriously hampering competitiveness, Dr Mangion said.

The MLP's suggestion on capping can be implemented in line with EU regulations if the government did not consider this issue merely as an accounting exercise, he added.