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Finance minister hits out at economic ‘misinformation’
Edward Scicluna ‘irritated’ by misinformation on economic data, confirms need to increase indirect taxation.
21 October 2013, 12:00am
Jurgen Balzan
Jurgen Balzan
3 min read
Finance Minister Edward Scicluna today lashed out at the systematic "misinformation on economic data" which he partly blamed on the National Statistics Office.
Scicluna said he was "irritated" by the constant reports in the media reports that erroneously show that inflation and unemployment are on the rise.
However, the minister blamed these incorrect reports on the way the National Statistics Office (NSO) releases information to the press.
"Today, one particular newspaper reported that inflation had increased, however in reality, inflation is at its lowest rate in a very long time. In August inflation stood at 0.6% however for some reason the NSO highlights the moving average instead of the latest rate of inflation. Its like going to a doctor to check your blood pressure and instead of being told what your blood pressure is at the moment, you are given an average of the past year."
Scicluna also hit out at a journalist "with a known agenda," and challenged him to publish the video recording of an interview held last week in which he reportedly said that taxes would be raised in next month's budget.
In his attack, understood to be addressed towards Times journalist Ivan Camilleri who interviewed the minister on Friday, Scicluna denied that he confirmed a plan to introduce new indirect taxes in the next Budget to yield an extra €50 million in revenue during 2014.
However, while addressing the MCESD members this morning, Scicluna said that an increase in indirect taxation was the only way government could make up for a €50 million cut in its expenditure as a result of the government's efforts to push the deficit below the 3% mark.
Earlier this month, in its report to the European Commission, the government stated that "For the period 2013 to 2016, the gradual losses from the revision in the income tax regime affecting direct taxation will be offset by similar gradual revisions in indirect taxation planned in the context of the budgetary exercise for the upcoming year."
The minister was speaking during an MCESD meeting during which the social partners presented their proposals for the 2014 budget.
Noting that "current revenue is not matching expenditure," Scicluna said that new measures need to be introduced to make up ground without increasing the national debt.
Reiterating the government's commitment to reduce the deficit below 3% of GDP, Scicluna said that government would be borrowing €50 million less and this had to be balanced out by an increase in indirect taxation.
He added that the tax wedge - the difference between labour costs on employers and the corresponding net wages of employees - had to be shortened, and this could only be achieved by shifting taxation from labour to consumption.
However, social programmes, Scicluna pointed out, would need to be introduced to soften the effects of such measures, which will be implemented "gradually."
The finance minister also underlined the government's main targets in the 2014 Budget; fostering economic growth, introducing social measures which are not a burden on the state and push people into employment and introducing measures to uphold social justice.
Jurgen Balzan was a MaltaToday reported from 2011 to 2017.
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Kumbinazzjoni fl-NSO kollha Nazzjonalisti, bhal gurnalisti tal-Public Broadcasting Service bhal gurnalisti tal-'Malta Independent' u bhal; gurnalisti tat-Times of Malta' . Kollox skond il-meritokrazija!
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(1) @ spa2130, indirect taxes are paid by all in equal measure irrespective of social or economic distinction. (2) @ anton, it is true that there are that number you mention (and far more in public entities), but mostly these are lower level "civil" servants without much education and demonstrable ability (apart from skiving). Moreover the sector is so controlled by unions and political favour that flexibility is evident by its absence.
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Issa drajniha l-mizinformazzjoni minn certi kwartieri. Il-gvern ghandu jkompli jimxi bil-programm
fejjiedi tieghu.
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25 years of gate-keeping for the PN by the English speaking media was not enough? Do they have to resort to double speak now? Ara fuq l-ex chairman tal-Malta Enterprise qatt ma smajna xejn! X'kull wahda ukoll!
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It would be interesting to find out what is happening with the 92 million euro of estimated revenue from vehicle taxation over and above the expenditure of 7.6 million euro in road construction and improvements! The Malta Automobile Club has launched its online petition to reduce vehicle taxation.
http://www.change.org/petitions/hon-minister-for-transport-mr-joe-mizzi-and-hon-minister-for-finance-prof-edward-scicluna-reduce-vehicle-taxation?share_id=SGdUlFdpOP&utm_campaign=signature_receipt&utm_medium=email&utm_source=share_petition
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Ok now minister please tell us who is going to pay for this misinformation from the NSO?
Jekk se thalli dawn il bsaten fir roti isiru se jigri bhal gvern ta Alfred Sant.
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Mr Minister,are these people who manage the National Statistics Office are still the same persons planted there by the previous PN? If,they still are still the same persons,then the PL have not learned his lesson yet.
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@BETTER FUTURE Truly words of wisdom. Whether the PL likes it or not, and I'm sure they don't, it has always fallen on their shoulders to clean up the fiscal messes that the PN leave behind. But, as in 1971, the PL will be successful. Although, admittedly, this time the challenge is of gigantic proportions.
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How much yhe cost of living increase is going to be....looks like there is complete silence..where are the unions?
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It is the lack of clarity that leads people to speculate as to what will actually happen.
Had there been direct responses to Ivan Camilleri in the interview mentioned there would be no speculation on how the minister intends to raise the € 50 million. We have learnt that unfortunately transparency is not one of this government stronger points and, in my opinion, it is this that is fueling uncertainty.
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@ Better Future...Yes I agree that we need to slash wastefulness in the public sector.
Firstly I cannot understand why we have more than 34,000 people working in the public sector & we still employ people from outside with the excuse of being consultants to the minister with some of them even sit on other boards earning another 2 or 3 wages
Aren`t there enough good people that can do that job ?....Is it possible that from over 34,000 gov employees , no one is qualified enough ?
Or is it because its pay back time for certain people & to hell with public coffers !!!
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Edward Scicluna accused The Times reporter of lying yet at the same time he confirmed what The Times reporter said. May I know who is lying please? Regarding "Better Future"'s comment: Indirect taxes are those taxes that are usually paid by those in need.
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Had the Maltese nation wanted to continue living in cuckoo land they would not have thrown out GonziPN by an astounding 37,000 votes. It is manifestly clear that Maltese taxpayers want their economic systems working in such a way as to balance outflows and subsequently produce surplus. This may be done in several ways. My favorite would be to slash the gross wastefulness of the public sector. Next go for growth, which would replenish Malta's coffers. But meanwhile, and until these two measures produce the desired results, then we have to put our hands in our pockets. Of course it goes without saying that the pockets that have long been spared examination should be the ones that pay most. There are so many blatant cases of abuse, like for one, huge expensive cars that obviously are not for hire carrying the K or Q plate.
