'Tax' on property owned by elderly in homes

Homes belonging to senior citizens residing in institutes for the elderly are to be taxed an arbitrary 5.5 per cent on the capital value of their property, according to Labour Party deputy leader Charles Mangion.

This emerged from a recently published legal notice, he said in a statement.

Dr Mangion said the deduction from these residents' pensions had also increased from 60 to 80 per cent. Moreover, once these people passed away, their children would be taxed at the maximum rate of 35 per cent on the property they would have inherited and sold.

The Labour spokesman said official statistics on the country's finances published on Monday confirmed the incompetence of the Nationalist government.

The statistics showed that up to the end of 2003 the country's total debt amounted to Lm1.3 billion. This meant that between 2002 and 2003, the national debt had increased by Lm200 million.

In the years 2000 - 2002 the increase in debt had been more controlled but in 2003, the Nationalist government increased its expenditure irresponsibly.

Even if one took into consideration the expense incurred at the shipyards, which meant a Lm41 million increase in the national debt, one would still see a rise of Lm160 million.

This one-year increase had led to a rise in the national debt, which had gone up to 72 per cent of the gross domestic product. This pushed the country further away from the Maastricht criteria. Worse still, this debt threatened the country's social web and pushed the disadvantaged closer to social poverty, Dr Mangion said.

He noted that the deficit and government borrowing for 2003 had also exploded, to Lm177 million from Lm102 million in 2002.

Not only had the Nationalist government not curbed its expenditure but statistics also showed that its entities and foundations were contributing to the ever-increasing government deficit.

Over a three-year period the debt of these entities had gone up from Lm13 million to nearly Lm23 million.

Faced with such a situation, the government, led by Prime Minister Lawrence Gonzi, was not offering a vision and an immediate plan to effectively attack the problems he had inherited but was only increasing the burden.

There had been increases on tariffs, licences, permits and documents the people required from day to day, he said. These taxes were benefiting those who could feel comfortable with the government's irresponsible expenditure such as the Lm10 million for Dar Malta in Brussels, Dr Mangion said.