Malta Budget Measures 2024

The Malta Budget, delivered by the Minister for Finance and Employment, Hon. Clyde Caruana, took place on the 30^th of October 2023. Here is a summary of the key highlights from Malta Budget 2024.

Economic & Business Measures

• The establishment of a Venture Capital Fund with the primary objective of assisting start-ups, especially those investing in technology and those with limited access to finance;
• The Seed Investment Scheme, the Startup Finance Scheme and the Skills Development Scheme have all been extended;
• A Common Central Data Repository will streamline applicant identification for businesses in Malta, ensuring access to basic bank services, simplifying company formation processes, and introducing audit exemptions for small companies;
• Family businesses registered with the Family Business Office stand to benefit from an increased capping of tax credits for investments made into the business;
• The MFSA is in the process of implementing regulatory changes including those relating to Notified Professional Investment Funds, Limited Partnerships and facilitating the setting up of new Family Offices in Malta;
• The government is developing a financing framework for aircraft leasing, which involves legal updates, specialised depreciation rules, and incentives for banks to support this initiative. Additionally, efforts are directed towards expanding hangar space and making amendments to maritime laws;
• Single work permits and new foreign work permits will be regulated and a new fee structure will apply;
• Outsourcing and temping agencies will also be regulated;
• The Business Enhance Scheme will be extended.

Social Measures

• COLA increase for all employees and people on social benefits will be of €12.81 per week;
• Pensions will be increased by a total of €15 per week including COLA, which means an effective increase of €2.19 beyond COLA. Income tax exemptions on pension income shall be adjusted to compensate for these increases;
• Minimum wage to increase to €213.54 per week, which means an increase of €20.81;
• Children’s allowance will increase by €250 per eligible child per year;
• In-work benefit to increase by €50 for every child under the age of 23 years;
• The in-work benefit of €150 given to those working atypical hours and whose pay does not exceed €20,000 will be extended;
• Increase in the Carer at Home allowance to €8,000 annually, which means an increase of €1,000;
• Parents will now receive an increased bonus of €500 for each newborn child and €1,000 for a second child, up from the previous amount of €400;
• Special allowance for parents whose children continue full time education amounting to €500 per year over a three year period;
• The social housing benefit will increase by €4,200 for single individuals and by €6,000 for families with a minimum of two children;
• Individuals who choose to delay their retirement by one year will receive a 6.5% increase in their pension, and this percentage will progressively rise to 29% if retirement is postponed by four years.

Property Measures

• € 10,000 grant directed to first time buyers extended;
• Capital Gains and Stamp Duty exemptions for restoration of vacant properties extended;
• Reduced stamp duty rate for first-time buyers and second-time buyers extended;
• 1st time buyers’ scheme extended, with allocation to grow from €3m to €5.2m;
• First-time buyers of either UCA or vacant property in Gozo will benefit from an additional €10,000 grant (amounting to €40,000 in total);
• Reduced stamp duty rate on immovable property purchases in Gozo shall not be extended in 2024;
• Schemes to be re-launched for facade restoration works for certain properties.

Tax Measures

• Income tax exemption to increase to 60% of pension income;
• An individual tax refund of between €60 and €140 will be issued in 2024. 250,000 people will benefit from this at a total cost of €26 million;
• Concession of Family Business Transfers: The reduction in stamp duty from 5% to 1.5% on family business transfers will be extended;
• Increase of €300 (€500, up from €200) per year in tax credit to parents of children with disabilities who attend therapy privately;
• Extension of other schemes, such as: 
  • grant schemes for the purchase of new electric vehicles, motorcycles and e-bikes;
  • scrappage of older vehicles
  • grants for the conversion of petrol vehicles to LPG;
• Introduction of incentives relating to personal e-scooters;
• Plug in hybrid vehicles will remain exempt from registration tax. A further exemption from the annual circulation tax shall apply for 5 years from the date of registration;
• The highly qualified persons rules are expected to be adjusted to current economic needs;
• Energy, fuel and grain prices will continue to be subsidised by government;
• Malta will work on the introduction of tax measures and incentives in the form of grants or qualified refundable tax credits that are compliant with the global minimum tax framework;
• Enterprises can receive a tax credit of up to €500 for their donations to NGOs registered with the Commissioner for Voluntary Organisations, specifically working in the fields of social, environmental, and animal welfare;
• Strengthening the regulatory framework of the gaming industry and continuing the implementation of the esports strategy;
• Malta will not introduce any top up tax measures under the global minimum tax framework during 2024.

Sustainability, Transportation & the Environment

• As part of Project Green, around 80,000 sqm of land will be developed into urban green spaces and over 5,000 trees are set to be planted;
• Schemes to encourage the purchase of solar panels, solar water heaters, heat pumps and other similar devices will be extended;
• The installation of 1,200 electric vehicle charging stations across the country;
• Extension of shore to ship system in the Grand Harbour and continuation of installation of such a system in the Freeport.

For more information about the measures announced during Malta Budget 2024, we invite you to contact our team of experts.