Tax cuts proposal to be included in next budget

The full tax cuts proposed by the Nationalist Party will be included in the budget for 2009, Prime Minister Lawrence Gonzi said yesterday.

Dr Gonzi said this is the third consecutive year that the PN in government was cutting the tax burden in line with its belief that lower taxes would generate more economic growth because people would work more.

The Nationalist Party has proposed reducing the tax rate from 35 to 25 per cent for those earning under €60,000 (Lm25,758) and widen tax bands, as part of an economic stimulus package. It is confident that within two years, the €46.5 million (Lm20 million) required to fund the shortfall in tax revenue will be recovered.

Dr Gonzi was speaking during the television programme Time With The Family, held at Villa Arrigo, in Naxxar and broadcast on Net Television. The theme for yesterday's discussion was employment.

Over the past four years, the government generated over 20,000 jobs and the number of gainfully employed people stood at 169,000, as opposed to an unemployment figure of 5,600. The results were achieved for a variety of reasons, mainly the fact that Malta became a European Union member state. Investors were keen on investing in Malta because of the reputation the country's workforce has of being skilled, flexible and English-speaking.

Dr Gonzi mentioned as examples the SmartCity project, the investments by Lufthansa Technik, HSBC and several pharmaceutical companies.

"Employment gives a person dignity. The PN has improved working conditions without the need of strikes or directives by unions. Between 1971 and 1986, under a Labour Administration, 3,100 people graduated from the University. Between 1987 and 2007, more than 31,000 graduated," he said.

Dr Gonzi reiterated the PN's promise to keep and improve the stipends, saying this is an investment in education.

When asked, Dr Gonzi said the 2,000 jobs the Labour Party is proposing to create every year were not enough for the country and this was why the PN was saying that under Alfred Sant the unemployment register would grow by 3,000 a year. It was worrying that the 2010 budget surplus target was not a priority for the MLP.