9 - 15 December 1999

MHRA warns over VAT

by a staff reporter

The President of the Malta Hotels and Restaurants Association, Joe Preca, has warned the government not to raise the present VAT rate on the tourism industry. Speaking at the MHRA gala dinner, which was also attended by the Prime Minister, Eddie Fenech Adami, Mr Preca said: "A crucial factor effecting our competitiveness is the price of the holiday. It is therefore not advisable to tax our industry any further. Any increase in VAT on accommodation will outprice us. Such an increase is immediately reflected in the price of the holiday. Other countries competing in the same markets have recognised this vital factor. Let us keep in mind that tourism offers immense employment possibilities. An increase in competitivity is a guarantee of further job creation." Mr Preca said that this year has been a satisfactory one for tourism. "Arrivals have been good, while earnings have been also satisfactory. There are also other reasons to feel optimistic and full of anticipation. The constitution of the Malta Tourism Authority should signal a new era for the industry. We envisage a scenario where problems, which have dogged the industry for many years, will be tackled from the roots and with the total commitment both from the private sector and the public sector," he said.

Mr Preca said that EU accession will force strict environmental rules, financial aids for the protection and maintenance of our historical sites and facilitates travel for our European visitors.