The latest Budget programme has indeed been compiled to battle out an unprecedented situation which has impacted millions across the globe. Following around eight months since the COVID-19 pandemic started to materially impact life as we know it, Malta is expecting a GDP deficit of 9.4% for 2020.
This follows four years of surplus, which have provided a good level of cover to fund the support measures. These support measures have helped to maintain Malta’s level of unemployment at just 4.1%.
For this wartime Budget, Malta has introduced a number of measures aimed at seeing us through the future impacts of this pandemic. One of the measures which is directed specifically for businesses is the fact that the VAT exempt threshold will increase from twenty thousand to thirty thousand Euro.
One other measure aimed at helping the local economy, is the vouchers scheme. Once again, one hundred Euro vouchers will be distributed to each person who is sixteen years and over. Sixty Euro of such a voucher will be allocated for hospitality and the other forty for retail and other services. These are scheduled for January, perhaps together with the arrival of a vaccine.
The wage supplement shall also be extended to March 2021, supporting businesses with the salaries of their employees. In 2021, employees will benefit from another day of leave, making the total to twenty-eight days, hence improving work and life balance.
There shall also be an increase in the tax refund of between forty-five and ninety-five Euro, with those who earn less than sixty thousand a year benefiting.
Considering that the property sector remains one of the most important pillars of the Maltese economy, government has also incentivised further acquisitions. First time buyers will be exempt from stamp duty, on the first two hundred thousand Euro, increased from one hundred and seventy-five thousand Euro. The reduced income tax rates for the transfer of property will extend to promise of sale agreements entered into before the 31st March 2021, provided that the contract is completed by the end of the year.
The Budget programme also catered for the elderly, with an increase in pensions. Together with the increase of the COLA, pensions will see an addition of five Euro per week.
What are your views on this wartime Budget programme? Do you think that the measures announced will suffice to guide the Maltese population through this pandemic? Let us know in the comments section below.