A statement by the GRTU – the Chamber of Small and Medium Enterprises – announced that an agreement had been reached with the government about the introduction of the eco-tax. This statement was later confirmed by a spokesman from the office of the Prime Minister.

The eco-tax was originally scheduled for implementation on 1 August, but this date was later changed to January 2005 due to a lack of agreement between government and the parties concerned, in particular the GRTU.

The GRTU said yesterday that the eco-tax will be implemented as from next month after a number of conditions had been agreed with the government.

These conditions include that no eco-tax will be levied on existing stocks held by traders/producers and that the eco-tax will not be levied on all listed products once they leave customs, a statement issued by the GRTU said yesterday.

The chamber added that no eco-tax will be levied at customs on non-EU originating products and no eco-tax will be levied once non-EU-originating products leave customs.

The eco-tax will actually be levied on listed products once the first VAT transaction has been effected, ie (a) either when traders or producers sell to wholesalers or retailers, or (b) when traders or producers sell directly to customers.

Eco-tax will be levied on products that are sold from warehouses by traders or producers. Listed products already on sale at retailers are not affected.

Sales of products to retailers prior to the effective date will proceed as at present, the GRTU said.

The chamber had asked for a postponement of implementation until January 2005 so that current stocks could be depleted. The government has now accepted that existing stocks will not be charged and new imports/production will not be charged until a first sales transaction is made. The GRTU therefore now considers that the date of implementation is no longer a major stumbling block and agrees that the eco-tax be introduced as from Wednesday.

The payment of the eco-tax will be made at the end of every quarter along with VAT. The VAT department is the authority responsible for the collection of the eco-tax.

The exact mechanism for the operation of the tax is still under discussion and a technical commission is being set up to discuss the technical aspects of implementation. GRTU is insisting that the eco-contribution is considered as a cost that is incorporated in the total price of the product and not invoiced separately.

The eco-tax will be refundable only if approved schemes of waste collection of the goods subject to the tax are in operation. Discussions on these schemes will proceed under the auspices of the proposed commission, the GRTU added.

The terms of reference of the proposed commission will be published shortly in the Government Gazette.

The Legal Notice that will qualify the Articles of the Eco-Contribution Act as they apply to administration, collection of the contribution and other technical aspects, and the official forms that will be used to implement the Act, will be published shortly, the GRTU said.

In a separate statement, the Union Haddiema Maghqudin said it had insisted with government that the eco-tax burden should not fall solely on the consumer. In a meeting it had with Prime Minister Lawrence Gonzi, the union said that once the eco-tax is implemented, a monitoring system should be in place to assess the impact the move will have on the people’s purchasing power. Through its representative on the Price Index Board, the UHM will check on the impact of the eco-tax and see that workers receive any compensation that is due to them.

In another twist, the General Workers Union said that in a meeting it had had with the Prime Minister, it had objected to the fact that the government had consulted entrepreneurs but had not talked to the unions. This meant that the government had ignored the interests of the workers and pensioners.

The GWU insisted that the government should see that the impact of the tax is absorbed by importers.