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MaltaToday online poll | Majority view 2013 Budget as regressive
In latest MaltaToday online poll, 57% say 2013 Budget did not address low-income earners.
3 December 2012, 12:00am
Jurgen Balzan
Jurgen Balzan
2 min read
The 2013 Budget granted a 10% tax-cut to the higher income earners.
Asked whether they approved of the 2013 Budget, 57% of respondents said that Finance minister Tonio Fenech's budget does not address low-income earners.
According to the majority of the 2,350 respondents to a MaltaToday online poll, the income tax cuts introduced by the Nationalist administration only benefitted the higher-income earners and persons on lower wages were not addressed.
32% of respondents said that the budget was positive for the country, while 11% of respondents said that the budget was positive, but only on tax cuts for high earners and inheritance tax removal.
The Nationalist government maintained its 2008 electoral promise to reduce income tax by 10% for earners who fall under the 35% tax bracket, which pay around 85% of all income tax paid to government.
However, the reduction will be carried out gradually over three years, meaning that by 2015 people who earn €60,000 will pay the same tax rate as persons earning between €14,501 and €19,500.
The reform will see a reduction of income tax for those earning between €19,501 and €60,000 from 35% to 25% over three years, starting at 32% in 2013, 29% in 2014 and 25% in 2015.
The reduction means that company CEOs and other high-earners, declaring €60,000 per year will save €1,200 next year, €2,400 in 2014 and €3,600 in 2015.
There was no change in tax rates for the low-income earners, with the persons earning up to €8,500 paying no income tax, persons earning between €8,501 and €14,500 paying 15% and persons in the €14,501 to €19,500 bracket paying 25%.
On the other hand, Tonio Fenech's plan to abolish inheritance tax on bequeathed and donated property was welcomed by many and could formalise what some consider as one of the most common forms of tax evasion for heirs.
Other measures which were received positively by social partners and the business community include incentives to industry by way of tax credits, the rebates to films produced in Malta, the extension of the micro invest to companies employing up to thirty persons, the incentives to hotels with rebates on investments made in their establishments and the incentives to boutique hotels in Valletta Mdina and the three cities,
Meanwhile, the removal of stamp duties in cases of succession, the valuation of properties by architects and the extension of years in quantifying the withholding tax, the child care investments, an increase in the children's allowance and the extension of maternity leave were also received well by many quarters.
Yet, with Franco Debono determined to vote against the 2013 Budget on 10 December, Tonio Fenech's budget will be implemented by Labour leader Joseph Muscat's government in the eventuality of a Labour victory at the polls next year.
Jurgen Balzan was a MaltaToday reported from 2011 to 2017.
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Briffy , How about the pensioners ? Did they get a 10% rise as well ? They don't qualify for children allowance . Those erning €60,000 got off quite well when considering that they not only got a reduction in income tax , but got a €100 rise per child in children allowance too .
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@Donna and others who see only thro' their red tinted glasses and so can't see things clearly. 1. The COLA is for 2012, not 2013; hence price changes in 2013 are not taken into account when the social partners and government determine the adjustment 2.It seems that you never had any children and so can't realise the expenses of bringing up children in a proper manner; the rises of a few cents in the price of fuel, cigarettes, pale out into insignificance when compared to the expenses of bringing up children 3. I am sorry to disappoint you but I am not a high income earner, just a pensioner 4. Yes I see my bottle half full because I appreciate living in a democracy which wasn't the case during the Mintoff/KMB regime, so I am happy
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ara briffy ghadu jezisti
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@briffy, what about the low income earners who dont have children so do not get family allowance. Now they will be taxed so the COLA increase will make no difference especially with the price of food going up every day, plus the gas going up, plus fuel going up. I gather you are one of the high earners.
Lawrence Covin •
This Briffy man has a habit of talking to himself. 57% of respondents are wrong according to him. He forgot to take into consideration the fact that liquid fuel, domestic gas and cigarettes went up. His bottle is always half-full (for now), and he's happy, which accounts for the missing half-bottle.
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@Briffy
In these extended 4 years of GonziPN we where always hearing that everything is fine, no worries, money no problem and everything showed us the contrary.
So how can we trust these people when an election is on the verge?
By the way even the PN councillors voted against there cabinet! How can we vote again ??
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The budget proposes increases in children's allowances in the case of low income earners, + the COLA, which would result in an increase of Eur1 000 to people earning around Eur10 000, that's 10% increase in toto. An immmediate 10% increase in income makes a hell of a lot of difference to anybody's lifestyle So how can anybody say that low income earners were not catered for?
