Developers eye Muscat’s land reclamation idea with interest

Labour leader Joseph Muscat said his party's proposals for any future land reclamation project would only be "project-driven" and carried out only if they are "economically sustainable".

Muscat was answering questions during a meeting he held with the Malta Developments Association, in which he expressed support for the MDA's name-and-shame register of abusive construction developers.

The MDA said it was interested in the idea for land reclamation projects. "We are looking at this proposal with an open mind," MDA president Michael Falzon said. "We hope any studies by a new Labour government will not come with preconceived outcomes as happens in other studies."

On his part, Muscat said land reclamation projects had already taken place at the Malta Freeport and Marsa power station.

"Although a previous study was carried out by MEPA, we think there is a question mark as to MEPA's competence on gauging the economic feasibility of a land reclamation project, since this is not expressly within its remit as a planning authority," Muscat said.

The Opposition leader also pledged his support for an equitable fiscal regime for property developers that does not encourage speculation, but does not tax losses on construction and property sales.

"Many developers are being taxed on profits not being made," Muscat said, in a reference to the MDA's gripes with the withholding tax for sold properties, which it wants reformed. "This system was introduced during a different time, and the market today has changed so the tax's ultimate aim is not being realised," Muscat said.

When asked whether developers complaining about stock they cannot sell due to high withholding taxes should just sell low and cut losses, Muscat said no government should decide any market prices. "It's the market that must regulate itself. As time passes, consumers are demanding properties of quality, not smaller units. But the issue of vacant properties must be addressed."

Muscat also said a new Labour government would extend the rental scheme recently introduced by the government for vacant property stock.