Budget 2020 at a glance

Wage increases, milk bonus, leave

• COLA increase of €3.49 per week

• Special one-off bonus to make up for milk and bread price increases. Single person households will get €15 and other households will get €35.

• One day will be added to leave

Income tax refund

• A tax refund ranging from €40 to €68 will be paid out to anyone who has worked

• This measure will benefit 200,000 workers and will cost €11.5 million

Lower tax on overtime

• Overtime will be taxed at 15%

• This measure will apply on the first 100 hours of overtime in a year, for those with a basic salary of not more than €20,000

• This measure will not apply to management positions

• The estimated cost of such a measure will be between €5million and €6 million

Equal pay for job of equal value

• The government wants to introduce the concept in the private sector of equal pay for jobs of equal value

• The matter will be discussed next year with social partners

• This is not a gender issue but one that will target cheap labour on shop floors where contract workers are paid less

• The concept will apply to basic wages

Pensioners

• Pensioners will receive an increase of €7 per week, inclusive of COLA

• People who retire from disciplinary corps after 25 years of service will have their retirement pension recalculated upon reaching retirement age

• The supplementary allowance for over 65 will increase by €50 to €150

• The old age benefit of €300 for those over 75 will be retained and increased to €350 for those 80+

• Government will issue 62+ bonds targeting 6,500 pensioners

• All those who are 75 and over will get free public transport

Child bonus

• Parents will receive €300 bonus for every child born or adopted

Social measures

• Discrepancies in children’s allowances for widows will be removed and all widows will receive €10 per week

• Injustice fund will get another injection of €13 million

• Disability pension for those who cannot work will increase to €161 per week, from €150.

• The grant to cover VAT expense on the purchase of equipment for the disabled will increase from €400 to €1,000

• Parents who take care of children with a rare disease will be awarded eight years of National Insurance payments

Health

• People suffering from fibromyalgia will be considered for sickness benefit, including first three days of sick covered by the government

• More medicines will be added onto the free formulary for oncology, heart disease, skin, and rare diseases

Property

• New scheme will see people under 40 who cannot cover the 10% deposit to buy a house, eligible for a government interest-free loan up to maximum of €17,000, paid back over 15 years

• First time buyers scheme will apply on property value of €175,000, an increase from €150,000, and the maximum benefit will increase to €6,500 from €5,000

• The new rent law will be introduced next year

• Schemes for property purchases in Gozo, urban conservation areas, second time buyers and equity sharing will be retained

• Housing benefit will be extended for those who spend more than 25% of their income on rent

• A 15% withholding tax will be introduced on the sale of air space

Climate change

• National strategy on carbon neutrality by 2050 to be published

• The changeover date when sale of zero and low emission vehicles will be stopped to be announced in 2020

• Electric car owners to pay special tariff of 12.98 cents

• Next year, the bottle return scheme will start

• Single-use plastic will be banned in phases starting from a ban on importation in 2021 and distribution in 2022

• Grant to help shops set up green corners where they can sell products by weight

• The project to roof over the exit of the Santa Venera tunnels will start

• Work on the expansion of the Ta’ Qali national park will commence

• A grant up to a maximum of €200,000 for contractors to change machinery into cleaner, and less noisy

• Schemes covering PV panels and water pumps will continue

• Those who introduced PV panels some years ago and whose pay back rate is running out will benefit from a €1,000 grant to buy their own battery to store electricity

• Lighting systems in all squares will be changed to renewable self-sufficient systems

• Malta Stock Exchange will open up for green bonds

No VAT on education

• VAT will be removed on educational and vocational services, including distance learning

Education

• One tablet, one child scheme will be extended to cover middle schools through pilot project

• Qawra primary school will be ready

• Drinking water fountains will be introduced in schools

• A new study on the weight of student bags

• Maltese language online spell checker will be developed at cost of €8 million

Other measures

• Malta Enterprise will invest in open areas in industrial estates to make them greener and adequate meeting areas for employees

• The ex-dump site in Luqa will be transformed into sport facilities, housing the Valletta FC football ground, and an enterprise zone

• Cash transactions in real estate, car, yacht, precious metals and art, purchases will be limited to €10,000

• NGOs will have planning appeal fees capped at €1,000
• Work on an adventure park in Cottonera will start

Gozo tunnel

• The pre-qualification questionnaire will be issued in the coming weeks

Economy and finance

• Economy expected to grow in real terms at 4.3%

• The surplus for 2020 is projected at 1.4%

• This will be the fifth consecutive year that public finances will record a surplus

• The country would still register a surplus even without the IIP funds

• The debt-to-GDP ratio in 2020 is slated to drop to 40.4%

• For the third year running, the budget has no tax increases

• Budget will cost more than €5 billion

• Economy will grow to €14 billion

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