MHRA dismisses Opposition MP’s tourist tax proposal as ‘rubbish’

The hotelier association has summarily dismissed Opposition MP Robert Arrigo’s calls for funds generated from a new tourist tax to be spent in the same areas in which they are collected from as “absolute rubbish”.

“Does this mean that places like Marsaxlokk will not receive any investment from the fund because it doesn’t have any hotels?” Malta Hotels and Restaurants Association CEO Andrew Agius Muscat told MaltaToday. “What’s important is that the money will be used to upgrade the tourism product across the islands.”

Tourism minister Edward Zammit Lewis also separately described Arrigo’s proposal as “rubbish”.

He said that some MHRA members are already looking to the future and planning road embellishment projects by their establishments that can be financed from the tourist tax fund.

However, he poured cold water over suggestions that the fund could be used to fix roads that the central and local authorities struggle to finance.

“Yes, roads form part of the tourism product, but upgrading them isn’t the scope of this fund, which will after all only generate €6 million a year,” Agius Muscat said.

As of June, all tourism operators – including people hosting tourists in their houses – will be obliged to charge their guests a 50c nightly eco tax, capped at €5. The money raised will be ring-fenced into a fund that will be administered through a public-private partnership with the MHRA.

Earlier this week, Arrigo accused Zammit Lewis of being “hostage” to the MHRA and urged him to grant other stakeholders a seat on the administration board.  

“If the money is collected by everyone, then it should be administered by everyone,” he said. “He should create roots of understanding and abolish his self-pride so that everybody can be on the same page.”

The Chamber of Commerce similarly warned that government hadn’t consulted the tourist tax proposal with its members, that include the Federated Association of Travel and Tourism Agents, the Federation of English Language Teaching Organisations Malta, the Professional Diving Schools Association and the Malta Association of Hospitality Executives.

“As a result, the implementation of the tax is seriously flawed and risks damaging the experience of the tourist and the industry.”

However, Zammit Lewis told MaltaToday that the Chamber was too late in putting forward its concerns.

“The tax is set to come into play in June, but they only approached me with their concerns two weeks ago, when the mechanism had already been fully set up. This tax was proposed in the last Budget and we can’t keep delaying it.”  

Since they voiced their concerns, the Chamber was granted a seat on the tourism zone development foundation that was set up in 2014 to safeguard tourist areas.

He vehemently denied Arrigo’s claims that he was being held hostage to the MHRA.

“I am hostage to no one, except to Labour’s electoral manifesto,” he said. “The fact that I often see eye to eye with the MHRA doesn’t mean that I’m its hostage. This government has an important and pro-active partnership with the MHRA, and perhaps Arrigo’s criticism stemmed from the fact that we have a better relationship with it than the previous administration did.”