The Malta Budget 2021 was presented by the Minister for Finance, Dr Edward Scicluna on Monday, 19th October.
The Budget at a glance…
(Source: Times of Malta)
Economy
- No new taxes for a fourth consecutive year;
- Wage supplement given to pandemic-affected businesses to continue until March 2021 at the very least. Eligibility for the supplement will be revised at the turn of the year, based on data from tax returns;
- Income tax refund to increase to between €45 and €80 for single people and €50 to €95 for married couples;
- Government voucher scheme to be extended with a further €100 in vouchers per person;
- VAT exempt threshold for businesses to rise to €30,000 from €20,000;
- For Gozo, existing schemes are to be extended.
Workers
- Cost-of-Living-Adjustment of €1.75 per week;
- An extra day of leave to compensate for public holidays falling on weekends;
- Better incentives for private pensions: the tax-exempt threshold is being increased to €3,000 from €2,000;
- Public sector workers who suffered past injustices to receive compensation: €9 million has been allocated for this;
- Workers or heirs of former dockyard workers who suffered asbestos poisoning are to receive an as-yet-undefined amount of compensation;
Parents
- Children's allowance increased for all families;
- In-work benefit thresholds to be extended to a further 4,500 families;
- Foster care allowance to go up by €10 per week;
- A €1,000 grant to couples who adopt a child locally;
- €300 grant for parents who have to quit work to care for a disabled child older than 16;
- Supplementary allowance to rise;
- Families receiving supplementary allowance will also be eligible for a €150 grant previously given to families defined as being at-risk of poverty;
- People hiring a carer to look after a person with a disability are now eligible for a €6,000 yearly grant;
The elderly
- Pensioners to get COLA plus €3.25 per week, amounting to a total increase of €5 per week;
- Pensioner couples paying income tax on their married computation to be exempt from tax;
- Elderly people who do not qualify for a pension to get a €350 bonus instead of the previous €250;
- People born before 1962 will now be able to count work done as 16- and 17-year olds towards their National Insurance contributions;
- Service pension beneficiaries to get a further €200 deduction when calculating their social security pension;
- Tallinja card to be given free for all those aged 70 or older, instead of 75 or older;
- Government bonds with favourable interest rates to be reserved for senior citizens;
- Aid grant to employ carers to increase from €5,291 to €6,000;
Property buyers
- Buying and selling property incentives are to be extended;
- Tax incentives for first-time buyers to be improved to up to €200,000 on property value, up from €175,000;
- Reduced tax on property given by donation;
- A property transfer concession of 1.5% tax (introduced three years ago) is to be extended by a further year;
NGOs and youths
- NGOs to be exempt on tax if their income is under €50,000;
- Students who continue studying after age 16 to get one year of free internet.
Transportation
- Car scrappage scheme to be extended and maximum grant to rise to €7,000;
- Safe cycle routes project to be announced;
- Extending or improving incentives for alternative transport use;
- Cars which are only used on weekends or public holidays to pay 35% less in road licence fees;
- Grants for taxis to be wheelchair accessible;
- Roadworks on Ħal Kirkop tunnel, Airport intersection project, Luqa junction project and Msida creek junction to begin;
- Study into mass public transport system to enter the second phase.
Health
- New medicines for chronic or mental illness to be added to state-provided medicines;
- Investment in osteoporosis treatment;
- More beds to be made available for the elderly in public and private hospitals;
- New centre for palliative cancer care developed in conjunction with Hospice Malta to open;
- Government to unveil a strategy to eliminate hepatitis C.
You can read detailed analysis of the budget by some of our members via the below links:
- Deloitte Malta – https://www2.deloitte.com/mt/en/pages/tax/articles/budget/2021/malta-budget-2021.html
- KPMG Malta – https://home.kpmg/mt/en/home/insights/2020/10/malta-budget-2021.html
- PwC Malta – https://www.pwc.com/mt/maltabudget2021
- RSM Malta – https://www.rsm.global/malta/news/malta-budget-2021-towards-sustainable-economy
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