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maltatoday, WEDNESDAY, 8 OCTOBER 2014 News 5 MIRIAM DALLI MINISTER for the Economy Chris Cardona has called for a revision of the eco-tax, bringing about a level- playing field and exposing illegal imports. The government has been inun- dated with requests to remove or modify the eco-tax imposed on goods imported from Sicily. While one minister, Edward Sci- cluna, called for "a well-thought solution" to combat unfair compe- tition, Cardona argued that eco-tax shouldn't become an obstacle to lo- cal importers or an impediment to competitiveness. Social partners, including the GRTU, the small business chamber, and the Chamber of Commerce, have submitted a plethora of Budget 2015 recommendations over what they perceive as an "unfair" tax which creates an uneven playing field for retailers. There currently exist inconsisten- cies in definition and application of laws and legal terms between EU states, and procedures adopted at different points of the Grand Har- bour that are not uniform. These inconsistencies are giving rise to unfair competition. A number of foreign and Maltese traders evade VAT, excise duties and eco-tax by importing goods using the catamaran link between Malta and Sicily. Unlike goods which reach Malta through the Freeport, goods trans- ported on the catamaran are not controlled. "The government's position is that there must be a level-playing field. The eco-tax should be an indica- tor to what's being imported legally compared to illegal imports," Car- dona said. The Ministry for Finance insisted that well-thought out solutions were needed so as to avoid exposing the government to an EU infringement. "Obviously this is a subject that concerns the European Union as well since we are part of the free trade. As government we have to ensure that the eco tax doesn't be- come an obstacle to local importers and their competitiveness," Car- dona added. He said that eco-tax had to be re- vised, and used as an instrument to even out the playing field between those who pay all vat contribution, income tax and eco tax and those who don't. "The eco tax also has its social and environmental responsibility and the discussion of its revision should be about how to balance it out." mdalli@mediatoday.com.mt CONTINUED FROM PAGE 1 He added that the opposition believes that state-sponsored health insurance should be preceded by the removal of limitations arising out of exclu- sions which most local policies tend to entrench. "It is unthinkable to use taxpayer money to sponsor health insurances which are ineffective and inappro- priate for the patient's requirements. The introduction of such concepts should not be driven by exclusively financial arguments but should be primarily based on fairness, equity and access to care whilst ensuring that public health services will re- main a free choice of health service at the point of care." Finance Minister Edward Scicluna was unavailable for comment as he was on his way to Washington where he is expected to participate in an IMF meeting. Representatives of three main in- surers who spoke to MaltaToday converged on the fact that the an- nounced scheme would be a catalyst for people to buy or upgrade their private medical health insurance policies. According to the Malta Insurance Association, the gross written pre- mium for private health insurance reached €22.1million in 2013 com- pared with €21.3 million in 2012, and €20.6 million in 2011. In 2013, claims incurred amounted to €13.4 million, compared to €13.1 million the previous year. Catherine Calleja, Director at At- las Group, said "we are of course in favour of stimulating demand for health insurance. As an industry we have been lobbying for incentives for some time. We would of course strongly advocate incentivising carefully so that we move people to higher level schemes which would move people away from using state care, as well as incentivising older people who again use the public service much more." She noted that the scheme should ensure that tax rebates are only given "where the country is likely to save money," adding that the indus- try has offered to collaborate with the government in this regard. While pointing out that the ma- jority of schemes are paid for by em- ployers, Calleja also underlined the fact that well over half of insured people have relatively basic levels of cover with very limited benefits, meaning that only a small fraction of major operations would be paid. Asked whether such a move would lead to higher health insurance pre- miums, Calleja said that a tax in- centive cannot lead to higher health insurance premiums in itself. She however warned that "if the incentive is tied to other issues such as charging insurers for certain state care, this will lead to higher premiums and we have to be careful that the client's increase in premium does not outweigh any tax savings." This, Calleja said, is a threat es- pecially for older clients who are currently most likely to lapse their cover due to cost increases. "Of course without understand- ing what the government is propos- ing, it is difficult for us to comment. We are however keen to enter into discussions with the government to increase the participation of the pri- vate health sector in this important area of the economy." Simon Anastasi, Chief Officer in charge of Group Life & Health at Middlesea Insurance agreed that tax rebates would lead to a greater demand which would also have a domino effect on private hospitals. "The demand for health polices would increase and this would in turn lead to more people making use of private hospitals," he said. Asked whether such a scheme could spell the end of free health services, Anastasi said "private health polices are not a substitute for public health services, but they are complementary to each other." On his part, Bupa branch man- ager Charles Zarb told MaltaToday "we are not yet informed as to the magnitude of the proposed tax re- funds as this is still a matter which the government needs to quantify," adding that the government has not concluded whether the scheme will apply solely to privately funded schemes or also include company funded policies. "Also one would need to see if there are any tied conditions pertaining to policies qualifying for such tax re- bates. So it is a bit premature at this stage to form a considered opinion," Zarb added. Tax rebate set to 'stimulate' demand PHOTOGRAPHY BY RAY ATTARD Economy Minister: eco-tax has to be revised While traders urge government to remove it, Economy Minister says eco-tax is also about social and environmental responsibility Chris Cardona Claudio Grech

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