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COVID-19 ‘Multi-million’ Stimulus PackageMEDIA ROOM
June 11, 2020
On Monday 8th of June 2020, the Maltese Government, led by the Prime Minister Robert Abela, Finance Minister Edward Scicluna and Economy Minister Silvio Schembri, released a multi-million economic stimulus package with the intention to help Malta recover from the challenging monetary difficulties headed as a consequence to the COVID-19 pandemic.
The abovementioned package involves measures and incentives affecting not only the economy itself, but also other enticements to promote the idea of raising the level of consumption of the nation, as a whole.
The Wage Supplement Scheme
Being, as a matter of fact, the costliest financial incentive implemented by our local government during the Covid-19 pandemic, this scheme is to be extended to at least September 2020.
As clearly specified and discussed during the press conference, certain sectors falling (still) under Annex A, including (exhaustive list):
- the entertainment industry,
- language schools,
- travel agencies and,
will continue to receive the €800/month/full-time employee. On the other hand, the remaining sectors which are also categorised under Annex A shall see their monthly monetary support reduced to €600/month/full-time employee and €375/month/part-time employee.
Moreover, businesses which were categorised under Annex A (since being forced to close due the pandemic) but are now categorised under Annex B (due to their re-opening and have started to receive clients) shall see their monthly monetary support reduced to €160/month/full-time employee.
Also, it is worth pointing out that unlike to what was implied by the abovementioned scheme when it was first introduced, pensioners & students having an alternative source of income, are now eligible to benefit from the supplement scheme.
Businesses' rent & electricity bill subsidy
For the months of July, August & September, businesses falling under both Annex A and B shall be given up to €2500 to subsidize rent. In addition, this multi-million package is also giving a 50% reduction in electricity bills (up to a maximum of €1500).
This package also denotes that the tax deferrals measures and incentives declared in March, shall continue to apply up until the end of August. The payment of these deferred taxes shall be spread across a twelve-month period and shall be paid back by May 2021 with no interest fees.
Moreover, the real estate market was also catered for, to a certain extent. This package brought about two changes in relation to the stamp duty when transferring property.
- The stamp duty payable by the buyer went from 5% to 5% and,
- the stamp duty payable by sellers was reduced from 8% to 5% (on all residential properties up to €400,000 and applicable for all contracts signed up until March 2021).
This shall also be available for individuals deciding to avail and benefit from the First-time Buyer Scheme.
For the next six months importers will benefit from a 33% reduction in port-charges. In addition, the package also offers a 10% refund on container discharge fees. Both the abovementioned benefits do not cater for trans-shipment.
Tax credits received as part of the Malta Enterprise micro-invest scheme can also be transferred into cash grants. Up to 30% of these credits can be changed into a cash grant which runs to a maximum of €2,000 or €2,500 if the business is based in Gozo.
Also, 210,000 workers who performed any type of labor in 2018, will be given a tax refund.
- Paid commercial licenses (including/such as) MTA and Commerce Department licenses will also be waived. Nonetheless, those who have already paid their respective licenses will get a waiver next year.
- Businesses (with a particular focus on small businesses) shall be given up to €5,000 in order for them to re-engineer and re-structure their business models.
- An additional €5,000,000 will be allocated to the ‘Skills Development Scheme’.
- €400,000 are being allocated in order to refund (up to €10,000) businesses which have incurred expenses in relation to promoting their service/product digitally abroad.
- As from Monday 15th June, fuel prices will be reduced by seven cents/litre. This means that:
- the price of petrol will go from €1.41 per litre to €1.34 per litre and,
- the price of diesel will go from €1.28 per litre to €1.21 per litre.
- All those aged 16 and over shall be given five vouchers (€20 each). Four of which can only be used in relation to hotels, bars and restaurants. On the other hand, the remaining €20 voucher may be spent at retail outlets which are now re-opening.
- In relation to prospective married couples, a maximum of €2000/couple will be given for expenses incurred due to the need of postponing their wedding in light of the pandemic’s circumstances.
- Also, a refund to a maximum of 80% of the expenses incurred by businesses who were participating in international fairs which were ultimately cancelled due to the pandemic shall be returned by the Government.
Worth a grand total of €900 million, this ‘multi-million’ package is considered to be the biggest plan of regeneration ever announced in the history of Malta.
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