Updated | Tax cuts, €700 million roads resurfacing project among Labour's top priorities

Tax refunds, resurfacing of every road in Malta, first-time buyers and giving workers back the public holidays that fall on the weekend are amongst the Labour Party’s priorities for a future Labour government.

In a preview of five proposals which the Labour Party will be presenting in its electoral manifesto – the manifesto is currently under internal consultation – Labour leader Joseph Muscat said that the party has completed 95% of its 2013 electoral manifesto and has a clear and costed plan for the next legislature

Tax cuts

Muscat said that Labour will boost people’s wealth through tax cuts, as part of a two-pronged policy to increase people’s disposable income and to boost business.

Some 190,000 people earning up to €60,000 will be applicable to tax refunds of between €200 and €340 a year, which will be implemented throughout the legislature. The scheme is estimated to cost some €46.5 million.

Part-time workers and self-employed people will also see their income tax slashed from 15% to 10% of their earnings, in an attempt to encourage more people to find a second job and to target the black economy.

Students who obtain a Master’s degree will be exempted from paying income tax for the first year of their employment, while students who obtain a PhD will be exempted for the first two years.

Pensions

Pensions will gradually increase to €8 per week, in line with the recently-agreed increase in the minimum wage.

It is estimated to cost some €17 million and will impact some 90,000 pensioners.

Responding to questions by MaltaToday, Muscat countered criticism aired by activists that the minimum wage increase was not high enough, arguing that it had remained stagnant for decades and that it will not precede the largest pension increase in Malta’s history.

Road resurfacing

In a major campaign pledge, Muscat said that every single road across Malta and Gozo will be resurfaced within the next year in what will be the largest infrastructure project in the country’s history.

The resurfacing works are estimated to cost around €700 million and will be funded from EU funds, the National Development Bank and the IIP posterity fund.

A government agency will be set up specifically to manage and coordinate the roadworks.

Muscat said that this will also free up funds for local councils, who will no longer have to fork out money for roadworks from their own limited coffers.

“The days where we go abroad and wonder at how other countries carry out their roadworks so smoothly are over, and the way the Kappara Junction project is being carried out will be the new normal,” he said. “Potholes are a major problem on Malta’s roads and when you’re driving, it sometimes feels as though you’re driving on the moon. Government agencies tell me that local councils are responsible for their upkeep, but then local councils tell me that they cannot afford the roadworks. Those days are over; Malta’s roads will now be on a European level.”

Public holidays

Finally answering a call which has been repeatedly made by workers’ representatives, the government will also be giving workers public holidays that fall on a weekend.

The holidays will either be added to workers’ annual leave or automatically given on the following Monday, introducing the concept of bank holidays to Malta.

“One of the complaints I have heard most often these past four years is that people don’t have enough time to spend with their families,” he said.

Home ownership scheme

Muscat said that the government will seek to aid those couples who just about cannot afford to put down a bank deposit to purchase their first home.

“We will not be creating an artificial market here, but rather help people who need that little extra nudge to afford a deposit. It will be monitored extremely diligently.”

Following in the footsteps of the first-time-buyers’ scheme, the government will introduce a second-time-buyers’ scheme.

“A person could buy himself an apartment, but then eventually seek to buy a maisonette. We will help people move upwards socially.”

‘Early election not due to panic’  

Muscat, who had previously said that the general election will be held in March 2018, denied that his decision to announce a snap election stemmed out of panic at reports that his wife owns an offshore Panama company.

Instead, he insisted that he wanted to ensure that the current political instability doesn’t negatively impact the economy.

“It would have been the easiest thing in the world for me to weather the storm on the seat of power, while waiting for the magisterial inquiry to clear my name before calling an election,” he said. “However, in those few months the economy would have been damaged and jobs would have been lost. I could see the early signs of this happening and so I took the responsible decision.”

Muscat also challenged PN leader Simon Busuttil on his claim that the next election will be “a choice between Malta and Joseph Muscat”.

“His campaign slogan is ‘I choose Malta’ but that isn’t the question. The question is whether Malta wants to choose myself or Simon Busuttil. I have made mistakes and I have paid the price for them, but I have never shied away from the public’s justice. It appears as though Simon Busuttil has a problem with the public judging him directly for his actions.”