Malta Budget 2019 – A Frank Overview

Frank Salt Real Estate brings you the key point of the Malta Government budget for 2019 which was presented in Parliament yesterday by Finance Minister, the Hon. Prof. Edward Scicluna.

The vision

• The Government retains its vision to give Malta its recognition for being amongst the best countries in the EU, for both social and economic reasons.
• Year on year, Malta has seen an increase in economic growth, employment, budget surplus, local and foreign investment, private consumption, exports and tourism, and a decrease in debt.

Property

• A tax incentive will be introduced for landlords who rent for long periods of time, below the market rate.
• A new scheme directed at persons aged 40+ will be introduced whereby they can enter into an equity sharing agreement with the Government.
• Social Housing means testing will be eliminated as from 2019, resulting into only two criteria to become eligible and benefits ranging between €3,000 and €5,000.
• First time home buyers will continue to benefit from a duty exemption throughout 2019.
• Second time buyers, ie persons who sell their first home in order to purchase another one, will continue to be eligible for a refund of duty as long as they do not own another property.
• The acquisition of property in an Urban Conservation Area (UCA) will continue to be subject to a reduction in duty.
• Persons purchasing a residential property in Gozo will continue to benefit from a reduced rate on duty.
• 2019 will impose a requirement for all rental contracts to be registered with the Housing Authority.
• Regulations are being drawn up which will permit individuals to leave their home to the Government in exchange for complimentary residence in an elderly home.
• The Government is planning to work with NGOs to transform dilapidated buildings in to social housing.

Residency schemes

• The Individual Investor Programme will be revised and made more robust.
• The Malta Residency and Visa Programme will be renewed.

Anti-money laundering and fiscal crime

• 54 new measures will be implemented over the course of three years in order to combat money laundering.
• Tax evasion/avoidance will be severely penalised.
• Countries committed against fiscal abuse will be favoured.
• Transparency in tax systems and strength in regulatory structure will be enhanced.

Technology

• The Malta Stock Exchange will continue to open its doors to blockchain and crypto currency stakeholders.
• Malta will be marketed as a centre for digital technologies through the establishment of ‘TechMT’.
• Discussions on a legal framework for Artificial Intelligence and Internet of Things to commence.

Infrastructure

• A €700 million road reconstruction has commenced, with €100 million being spent in 2019.
• €1 million will be spent on the conversion of open air spaces into public gardens.
• Incentives will be offered to individuals who show an interest in developing car parks.
• The finalised geological studies for the Malta/Gozo will be the foundation for the tunnel designs.
• A Paceville embellishment project is being planned.

Eco-friendly measures

• Plans for a new recycling plant are in the pipeline.
• Efforts will continue to be made to have waste separated at source.
• Electric cars will continue to be exempt from tax.
• A tree will be planted for every child born and every new car on the road.
• A new scheme for the return of drink bottles is being discussed.
• The use of renewable energy will continue to be promoted.

Social impact

• Malta salaries saw an increase of 8.2% in the first half of 2018.
• 2019 is expected to see a rise in inflation of 1.9%.
• Couples, single persons, families, pensioners, as well as persons with disabilities and their carers will continue to benefit from the current and enhanced social measures both in services and financial terms, and quality of life is set to improve as a consequence of the strong economy.
• The Government has pledged to withhold any new taxes and employees will see an increase of €2.33 per week, an overall tax refund of €11.5 million, and an extra day of leave. Persons earning a minimum wage will receive €3.00 a week over the €2.33.
• Fuel and energy prices to remain fixed.
• National medical services will be improved with new investment being made in various areas.

To learn more about the Malta budget for 2019 and what it means for you in terms of your current property interests or your relocation or investment in Malta, please get in touch with us and one of our senior property consultants will be able to guide you.