'Motivates work but falls short on tourism investment incentives' - MHRA

"We regret to note that despite the call to the previous and current Government to reduce the VAT rate from 7% to 5%, to allow enough resources for the embellishment and renovation of the hotel product, this has not happened," MHRA said.

The Malta Hotels and Restaurants Association president Tony Zahra
The Malta Hotels and Restaurants Association president Tony Zahra

The Malta Hotels and Restaurants Association said it welcomed the policy of incentivising work for unemployed people to re-enter the job market, as well as for part-timers, women, job placements for youths, and income tax reductions.

But MHRA noted that in 2013 the expected arrivals to Malta would exceed 1.5 million or 100,000 more arrivals resulting in an additional €45 million in multiplier revenues.

"MHRA regrets to note that despite the call to the previous and current government to reduce the VAT rate from 7% to 5%, to allow enough resources for the embellishment and renovation of the hotel product, this has not happened."

MHRA said it was concerned that the tourism product would suffer, sending the industry in a downwards spiral.

MHRA welcomed the confirmation of the reduction of energy and water tariffs.