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Travel agents’ dispute,
Sunday shopping
The leader of the Opposition, Dr Alfred Sant, recently said
that 2001 will be a year of controversies. Although he was referring
to other issues such as membership of the European Union, he
was spot on. In the first week of the new year, the local business
community has witnessed two major disputes: that over contributions
to the Malta Tourism Authority and VAT on travel agents’
services, and the war of words between the Association of General
Retailers and Traders and the operators of Baystreet with regards
to shops opening on Sundays.
The MTA has stressed that the private sector has to contribute
more to help the authority market the country abroad. In the
light of a weakened tourist industry, the authority has felt
the need to reposition its self and tap new markets. This, undoubtedly,
requires more money, thus the increases in contributions from
the travel and tourism agents.
On the other hand, the Federation of Associations of Travel
and Tourism Agents (FATTA), while not denying that contributions
had to be increased, said the increases are exorbitant. They
have also criticised the MHRA which said that the increases
were favourable.
The Malta Business Weekly is more than aware of the MTA’s
need to reposition the country and to redefine its marketing
strategies – and thus the need for more funds. However,
we question whether these increases – which MTA chairman
John C. Grech described as fair – are just, considering
the present scenario in the local tourism industry. FATTA have
claimed that travel agents are facing a 2,000 per cent increase
while the increase for hotels is only 100 per cent. It is easy
to play with figures but if FATTA is correct, the discrepancy
is certainly too high.
The GRTU at its annual general meeting approved a motion against
the authority and the association’s president, Charles
Busuttil criticised the authority for the “arrogant”
manner in which the fees were increased without any consultation.
These increases also come at a very bad time for travel agents.
Two legal notices published at the beginning of the year have,
in their own words, imposed a turnover tax of 15 per cent on
gross profits. Travel agents must now see how they are going
to recoup these losses and this can only come about by transferring
the added tax to consumers – a case of robbing Peter to
pay Paul. What is irritating is that the consumer always has
to carry the burden.
The government has kept quiet on the issue instead of coming
forward with a solution. The Malta Business Weekly strongly
feels that the problem originated simply because there was a
lack of consultation across the board.
We augur that the MTA, the Tourism Ministry and the travel agents
are able to sit round a table and possibly re-consider the added
increases in contributions. We cannot expect the tourism industry
to improve if there is not a concerted effort by all those involved.
Bickering will get us nowhere.
Legal loopholes
It is amazing how laws in this country are bent, twisted and
enforced only when seen fit. The current dispute between the
operators of Baystreet, shop owners in Bugibba and the GRTU
boils down to how each party interprets the law prohibiting
shopping on Sunday and allows extended opening hours.
Shop owners in Bugibba on Sunday were forced to close shop because
they are not permitted to do so by law. At the same time, it
was business as usual at Baystreet, and they are permitted to
do so by law – because the retail outlets there form part
of a hotel complex. The GRTU has objected to this interpretation
of the law saying that shops at Baystreet do not fall under
this category.
After all that has been said, the government must take stock
of the situation and find a solution. It will not be easy and
the chances are that any decisions taken will be in favour of
the GRTU’s stand. The government has made it very clear
that it is not in favour of shops opening on Sunday, even though
the majority of those questioned in a Malta Independent survey
last year said they want certain shops to open on Sundays.
Any move to hinder Sunday shopping will also badly affect Baystreet.
Millions of liri have been pumped into the complex and the retail
outlets have spent thousands to set up shop. There is a lot
of money at stake apart from jobs to be lost.
Taking rash decisions without really examining the situation
and the obvious changes in shopping trends will only cause further
problems.
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