Developers criticise introduction of excise duty on construction material

Budget 2017 has received an overall thumbs up by the Malta Developers Association but criticism was raised over the introduction on a new excise duty.

According to the Finance Minister, the new excise will be on building materials used mostly for large scale projects - which will be redirected to environmental projects. However, the MDA argued that the on imported construction materials "will negatively affect the small consumer who is acquiring his first home".

"The MDA welcomes with satisfaction a number of measures announced in the Budget Speech, measures which the Government intends to implement to continue to maintain the good pace of economic development in the country in recent years," it said in a statement.

The MDA went on to list the measures which it had proposed and the government took on board:

• the extension of the scheme through which first time buyers are exempt from paying stamp duty on the first €150,000;
• the concession for those who are passing on their business to their children where stamp duty on transferred property will be of 1.5% instead of 5%;
• a fiscal incentive for those who rent for not less than seven years so that the tenant will be reassured that he has a reasonable period in which he will not lose the lease;
• the lowering of stamp duty on those who buy property in Gozo from 5% to 2%;
• the removal of the anomaly that exists when parts of structures that are made abroad have an advantage on those made in Malta because of the excise duty on cement;
• fiscal incentives for those who develop car parks;
• the renewal of temporary leases where government is the owner; and
• financial assistance schemes for products that are energy saving, like heat pumps.