MHRA President Josef Formosa Gauci has attended a seminar organised by the Association for Hotels, Restaurants and Cafes in Europe (HOTREC), to discuss the application of reduced VAT rates for hotels and restaurants services in all EU Countries.

He was accompanied by Caldon Mercieca from the Tourism and Culture Ministry.

HOTREC has been lobbying at European level since 1992 and encouraging its members at national level to do the same, so that all member states apply reduced rates on accommodation and restaurant services.

In a statement yesterday, the MHRA strongly urged the Maltese government to lobby favourably for, and to consider the acceptance of the application of reduced VAT in hotels and restaurants services.

“MHRA strongly believes that the introduction of a reduced VAT rate on restaurants in Malta and Gozo will reduce the evasion of payment of VAT and such a measure, coupled with high fines for those who do evade the payment of VAT on such services, will give a level playing field for all those engaged in this sector.”

During this seminar László Kovács, EU Commissioner for Taxation, emphasised that reduced VAT rates are generally considered as effective instruments to achieve the objectives of the Lisbon agenda: increased growth, more jobs and competitiveness.

The European Commission is to issue, by 30 June, a report on the impact of reduced VAT rates on a variety of services, including restaurant services. The June report will, hopefully, be the starting point for a renewed debate at European level and of the search for a definitive viable solution for VAT rates for all sectors.