Gozo Business Chamber raises concerns over Budget 2027’s impact on tourism

The Gozo Business Chamber has warned that higher accommodation charges and Gozo Channel fares could undermine the island’s tourism competitiveness, calling for the impact of Budget 2027 measures to be assessed.

In a reaction to the budget, the chamber welcomed several measures supporting businesses and investment but said policies affecting tourism and foreign workers required “careful assessment from a Gozitan perspective”.

From January 2027, the eco-contribution will rise to €8 per person per night, capped at €64, for collective accommodation, and €10 per night, capped at €80, for short lets.

“The rationale for applying a higher rate to short-let accommodation than to collective accommodation should be clearly assessed,” the chamber said.

It also called for clarity on how the new rates would affect domestic tourism, particularly weekend breaks and short stays.

The chamber argued that tourism’s impact on Gozo extends beyond overnight visitors, with day-trippers also using the island’s roads, public spaces and maritime infrastructure without contributing through the accommodation-based eco-contribution.

“It is important that the eco-contribution generated through tourism activity in Gozo should be directly reinvested in Gozo itself,” it said. It called for investment in infrastructure, environmental quality and the visitor experience.

The chamber also warned that higher accommodation charges and revised ferry fares should not be considered separately.

“It is important to assess the cumulative impact of these measures on the total cost of a holiday in Gozo, and consequently on the competitiveness of the Gozitan tourism product,” it said. Gozo’s double insularity already adds travel costs for international visitors, it noted.

Work permit fees raise concerns

The chamber also called for close monitoring of higher work permit fees for third-country nationals. New applications will rise from €600 to €800, while an additional annual infrastructure contribution of €400 will apply to new applications and renewals.

“The reality of the Gozitan economy must also be considered,” it said. The chamber pointed to businesses that depend on foreign workers and already struggle to recruit staff.

The impact on competitiveness should be monitored, “particularly in those sectors where labour shortages are already significant”, it added.

Meanwhile, the chamber welcomed a new framework allowing companies with turnover of up to €1 million to benefit from a 25% corporate tax rate, instead of 35%, on profits retained or reinvested in their businesses. “Encouraging businesses to retain and reinvest profits can support greater productivity, modernisation and further investment,” it said.

Calls for long-term investment

The chamber welcomed plans for nine additional outpatient clinics under the Gozo General Hospital masterplan, while stressing the need for a long-term plan for a new hospital with adequate staffing and specialist services.

It also backed investment in electricity connections between Malta and Gozo, including two new submarine cables, describing reliable energy infrastructure as essential for the island’s economic development.

However, it called for progress on major projects, including new Gozo Channel vessels, the expansion of Mġarr Harbour, the proposed Gozo Rural Airfield and preparations for Victoria’s European Capital of Culture title in 2031.

“These projects should be supported by adequate financing and clear implementation pathways throughout the legislature,” it said.