With the theme ‘Malta inkomplu nikbru flimkien’, Finance Minister Edward Scicluna presented the Budget for next year with an expenditure of €5 billion euro. The budget lacks new taxes and its measures include two bonuses for workers, together with a cost of living compensation. Overtime tax rate will go down, while a bonus was announced for each new born baby or an adopted child. Among other measures, an increase in pensions was also announced in the budget.
In his third budget of this legislature, Minister Scicluna announced a cost of living increase of €3.49 a week. Apart from this increase, the Government will be giving a one-time bonus of €15 to a single parent family and €35 to families of more than one person as a compensation for the increases in milk price, which has not yet fallen under the COLA system. Minister Scicluna also announced that the tax refund to 200,000 workers whose income is less than €60,000 euro a year will be given again, and varies between €40 and €68, with the highest rate paid to those with low income.
Once again, the Government will increase pensions and from the 1st January, pensioners will benefit from a €7 weekly increase, that includes the cost of living increase. Minister Scicluna stated that this is the biggest increase in pensions in the past 40 years, and follows increases given during the past five years. An adjustment will also be made in pensions of disciplined forces members who retired after 25 years in Service. The disrepancy will be removed in widows’ pension, between those who are employed and those who do not work, with their pension increasing with €10 a week.
Another measure which affects many workers concerns tax on overtime which will be now paid with the rate of 15% up to 100 overtime hours annually. This measure is limited to workers whose income is not over €20,000 yearly and does not affect management members. The budget also provides for an increase of another day in workers leave to compensate for feasts that fall during weekends.
Minister Scicluna also announced that as of next year, the Government will give a one-time €300 bonus for every new-born baby. The bonus will also be given to families who adopt children. The pension of persons with disability who, due to their condition they cannot work, will increase from €150 to €161.40 a week, which means that when the social contribution is not paid, it is equal to the minimum wage.
Minister Scicluna announced that families with children who are diagnosed with rare disease will be considered similar to families with disabled children in social contibution payments. It was also announced that the Government will pay for the first three days of sick leave in certain diseases, including cancer and fibroma.
With regards to rents and property purchase, next year’s budget will extend from 150,000 to 175,000 properties on which stamp duty is not paid by persons buying their first property. On subsidies for rents by the private sector, persons will be given subsidy if their income is not over €32,000 annually. The budget also consists of measures that assist persons to become home owners with the extension of the equity sharing scheme with which the Government will loan up to €17,000 for the purchase of a property which is paid back, interest free, within 15 years.
The budget also provides for a whole package of measures aimed at decreasing the climate change effect that vary from a ban on plastic used only once to an incentive up to €1,000 to families who own solar panels where their feed in tariff agreement expires. The €5 billion expenditure budget does not have any new taxes and neither reductions of other benefits given in previous years. The Government estimates that economic growth will at least reach 4.3% next year, while it is also planning a 1.4% surplus for 2020 and a reduction to 40.4% of national debt in relation to the Gross Domestic Product.