Budget highlights MALTA BUDGET 2022 - Deloitte
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Budget highlights MALTA BUDGET 2022
Budget highlights | Economic overview
Economic
overview
After a very challenging 18 months, the general apprehension levels of prospective Inflation is expected to hit 1.7% as a result of
outlook for 2022 remains conditioned by the tourists to catch an international flight higher international energy prices, increased
unavoidable COVID-19 induced challenges and will continue to require Government's logistics costs and food prices.
and uncertainty. support and recovery incentives.
The deficit as a result of the COVID-19
Although the Government is predicting that In FY2022, Government consumption levels pandemic is expected to push Government
the economy as a whole will grow by 6.5% in are expected to return to FY2019 levels, debt in 2022 to 62% of GDP and will
FY2022 and return and recover to FY2019 whilst private consumption is expected unavoidably pose an economic challenge for
levels, it is accepted that the recovery to gain momentum and grow by 4% over a number of years ahead.
of the tourism sector and other sectors FY2021 levels.
which are directly or indirectly dependent
on tourism will take longer and that these Significant growth in exports and domestic
impacted sectors will continue to perform investment is expected on the back
below FY2019 levels. The tourism sector’s of incentives aimed at stimulating the
prospects remain highly dependent on the manufacturing and tourism sectors.
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Budget highlights | Social measures
Social
measures
• Pensioners shall benefit from a weekly • The bonus granted for the birth or
increase of €5 with effect from 2022. This adoption of a child shall increase to €400.
increase represents a €1.75 cost of living
adjustment increase and an additional • Free childcare service shall be extended
increase of €3.25. for those working during weekends and
on a shift basis.
• Medicines and treatments available for
free shall increase to include, amongst • The Government shall enter into
others, oncology treatment, psychiatric discussions with the MCESD with respect
medicine and medicine for osteoporosis. to the implementation of the EU Directive
on Parental Leave and Work-life balance.
• The annual allowance for children with a
disability shall increase to €1,560.
3
Brochure
Budget highlights|
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Susatainability measures
Section title goes here
Sustainability
measures
• A new strategy shall be introduced to • The SME Tailored Facility managed by
increase green spaces in urban areas as the Malta Development Bank shall be
well as provide aid to Maltese companies extended to include lending facilities for
investing in sustainable environment sustainable and environmental projects
projects. undertaken by the private sector.
• Local councils shall receive funding to • Malta will introduce legislation to
implement sustainable development strengthen enterprises that strive
projects. for social inclusion, sustainability and
environmental protection.
• The Energy and Water Agency shall
launch two new projects in public spaces
to exhibit the use of renewable energy
battery storage systems.
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Budget highlights | Transport measures
Transport
measures
• With effect from 1 October 2022, Malta tax and annual licenses for a 5-year
resident individuals shall benefit from period shall be extended for another
free public transport. year.
• The financial incentive relating to the • The existing grant of up to €400
purchase of electric or plug-in hybrid currently provided for the the purchase
vehicles shall increase to €11,000 of motorcycles, scooters and electric
(€12,000 if the scrappage scheme is also bikes shall be extended for another
availed of). year. Similarly, the VAT grant scheme
on the purchase of bicycles, pedelecs
• The financial incentive relating to the and motorised bicycles shall also be
scrappage of polluting vehicles shall extended. The grants currently available
increase to €2,000. for conversion of vehicle combustion
from petrol to gas, and those in relation
• The existing measures relating to the to taxi or hire vehicles which are
purchase of less polluting vehicles, accessible to wheelchairs, shall also be
including an exemption from registration extended.
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Budget highlights| Fiscal measures
Fiscal
measures
• With effect from 1 June 2022, the annual who are not employed in a managerial • The reduced stamp duty rate of 1.5%
rate of interest imposed on income tax position shall be taxed at the rate of 15%. currently in place for qualifying business
and VAT balances shall increase to 7.2%. transfers effected by parents to their
• The tax rate on qualifying part-time children shall be extended for qualifying
• Tax refunds granted over the past years income shall be reduced from 15% to 10%. donations.
to individuals earning less than €60,000
shall also be granted in 2022. These • In an effort to help groups recover • With effect from FY2022, individuals
refunds range between €60 and €140, from the ramifications of the COVID-19 working in the art, culture and
depending on the level of income. pandemic, qualifying companies that entertainment sectors shall benefit from
incurred losses during FY2020 and a income tax rate of 7.5%. The tax due by
• Part-time employees will have the FY2021 may surrender any unabsorbed the said individuals shall be calculated on
opportunity to pay social security on capital allowances to qualifying profitable a 3-year average period.
more than one part-time job, up to a group companies during FY2021.
maximum of 40 hours of work per week.
• Malta Enterprise shall also launch a
• During 2022, the first €10,000 of income scheme whereby companies will benefit
from overtime received by employees from tax benefits calculated by reference
earning not more than €20,000 and to any re-invested profits.
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Budget highlights| Property measures
Property
measures
• Tax and stamp duty on transfers and and, newly built properties having a
acquisitions of property that was typical and traditional Maltese style and
previously being rented to tenants eligible architecture.
for any schemes administered by the
Housing Authority shall be reduced by • Persons purchasing certain specified
half on the first €200,000 of the value of types of property, such as property
the property. No tax and stamp duty shall situated in an urban conservation area
be levied in the case of a transfer of the may be eligible to benefit from a grant
said property to the previous tenants. of up to €54,000 (equivalent to the
VAT element) on the first €300,000 of
• No tax and stamp duty shall be levied restoration costs.
on the first €750,000 of the property
transfer value in the case of properties • The ‘Equity Sharing Plus’ scheme shall be
which were built at least 20 years prior to extended to persons over 30 years old
the date of transfer and which have been and shall provide security for up to 50%
vacant for more than 7 years, properties of the value of the property.
located in an urban conservation area
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Brochure
Budget highlights|
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Governance Section title goes here
measures
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Governance
measures
• A plan has been put in place to address • An online application system is in the
the FATF’s action plan and shall serve process of being developed to enable
as guidance to the authorities for the eligible prospective clients to apply online
purpose of implementing the FATF’s for legal aid.
recommendations.
• Discussions are underway for Malta to
• The office of the Attorney General will hold a temporary seat on the United
be taking on additional functions in the Nations Security Council for two years
prosecution of criminal offences with throughout 2023 and 2024.
the intention of setting up a specialised
prosecution service and for the
police to be able to focus more on the
investigation of offences.
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Brochure
Budget highlights|
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Othergoes here |
measures Section title goes here
Other
measures
• Malta shall launch a new ‘Start-up Visa’ • New measures to promote the arts
which will offer start-ups a flexible industry include a new €1 million fund
method to move their location to Malta. to create a guarantee scheme for
independent artists’ activities and a €2
• Malta Enterprise shall set up the Blue million scheme to provide aid for cases
Med Hub with experts to attract local and where seats are not sold due to COVID-19
foreign start-ups and SMEs. restrictions.
• Students in Malta shall receive a 10% • Malta will be hosting the Games of
increase in their stipends and students the Small States of Europe and the
shall remain eligible for stipends even in Government will be providing €7 million
cases where they work for up to 25 hours in assistance to sports associations and
per week. the Maltese Olympic Committee.
9Deloitte accepts no liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication. Deloitte is a leading global provider of audit and assurance, consulting, financial advisory, risk advisory, tax, and related services. With over 175 years of hard work and commitment to making a real difference, our organisation has grown in scale and diversity—approximately 334,000 people in 150 countries and territories, providing these services—yet our shared culture remains the same. Our organisation serves four out of five Fortune Global 500® companies. Learn how Deloitte’s people make an impact that matters at www.deloitte.com/mt/about. The Deloitte Malta firm consists of (i) Deloitte, a civil partnership regulated in terms of the laws of Malta, constituted between limited liability companies, operating at Deloitte Place, Triq L-Intornjatur, Central Business District, CBD 3050 Malta and (ii) the affiliated operating entities: Deloitte Services Limited (C51320), Deloitte Advisory and Technology Limited (C23487), Deloitte Audit Limited (C51312) and Malta International Training Centre Limited (C5663), all limited liability companies registered in Malta with registered offices at Deloitte Place, Triq L-Intornjatur, Central Business District, CBD 3050 Malta. The Deloitte Malta firm is an affiliate of Deloitte Central Mediterranean S.r.l., a company limited by guarantee registered in Italy with registered number 09599600963 and its registered office at Via Tortona no. 25, 20144, Milan, Italy. For further details, please visit www.deloitte.com/mt/about. Deloitte Central Mediterranean S.r.l. is the affiliate for the territories of Italy, Greece and Malta of Deloitte NSE LLP, a UK limited liability partnership and member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). DTTL and each of its member firms are legally separate and independent entities. DTTL, Deloitte NSE LLP and Deloitte Central Mediterranean S.r.l. do not provide services to clients. Please see www.deloitte. com/about to learn more about our global network of member firms. © 2021. For information, contact Deloitte Malta.
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