Chamber of Commerce proposes change in married tax rate, increase in compulsory education to 18

The married tax rate should be overhauled because in its current structure it discourages the second spouse, traditionally female, from gainful employment, the Chamber of Commerce said.

The proposal is one of several recommendations made in a policy document proposing a national workforce strategy to attract more people to the labour market.

Another proposal calls for a gradual increase in the age of compulsory education to 18, including at least two years of post-secondary education.

The document was presented to Finance Minister Clyde Caruana on Wednesday. The government is currently drafting a labour market policy, which it intends publishing in October. Opposition spokesperson Jason Azzopardi was also given a copy.

Chamber of Commerce President Marisa Xuereb (centre) presented Finance Minister Clyde Caruana (right) with the organisation's proposals for a national workforce strategy

Other proposals include a personal taxation structure designed to attract foreigners to work in Malta, a tax break for the first five years when highly qualified Maltese working abroad return to work in the country, and fiscal incentives to attract individuals in possession of certain critical skills.

The Chamber is also calling for measures that “encourage more balanced utilisation of leave entitlements between women and men after childbirth”.

Early intervention to support children whose parents are not socioeconomically active or in education is another key policy area with the Chamber proposing extending the free childcare scheme to these categories.

Government must also introduce measures to encourage older employees active in the black-market economy to transition into the mainstream economy.

The Chamber also presented its proposals to Opposition work spokesperson Jason Azzopardi

Making it easier for foreigners

Targeting foreign employment, the Chamber is calling for improvements in the work permits process to make it easier and faster.

It also proposes an improved process for family-relocation for approved work permit applicants.

The Chamber wants to have work permits renewable every three years, following the first successful year of a third country national, giving them more permanency.

The system should also address the adequacy of salary requirements being asked for foreigners who wish to relocate their family to Malta. “The current benchmark is higher than what the average Maltese employee earns to support his family,” the Chamber says.

Reducing school leavers, increasing female participation

The Chamber says that government must aim to decrease the rate of early school leavers to below 10% by 2025 and increase the number of students completing at least a post-secondary level of education by 10%.

Malta must attain the European 2020 target of at least 75% employment rate for both women and men by 2025. While the rate for men is above that rate, women still lag behind despite huge improvements over the past five years.

Another target should be to increase the total percentage of females who occupy full-time positions or self-employment by 10% by 2025.

The Chamber also harps on the need to encourage older people to continue contributing to the workforce. It says the percentage of those aged 55 and over in active employment should increase by 5% in four years’ time.

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