Federation of Estate Agents approve of budgetary measures

The Federation of Estate Agents (FEA) welcomed the measures which were announced in the budget yesterday evening.

These new measures include the introduction of a final withholding tax on rental income, the exemption of stamp duty for first-time buyers, a revision of the government appointed architect valuations, and the promotion of property to foreigners.

Ian Casolani, owner of Belair Real Estate and Deputy Chairman of the Federation of Estate Agents said that the Federation had been lobbying for the implementation of withholding tax for rental income for "at least five years".

Asked by MaltaToday whether this could lead to an increase in rent by property owners - in order to neutralize the burden of tax payment - Casolani said that he did not believe this would happen.

"Such a measure allows for those property owners who have been evading tax for years, to now pay tax at a realistic cost and through the proper channels," he said.

"Of course, it is always difficult to categorically foresee certain scenarios but I personally do not believe that this new measure will reflect in an increase in rents by owners," he said.

Casolani admitted that there may be some property owners who may increase their rents but he said that these will probably make up the exception and not the rule.

In the budgetary speech, it was stated that rental incomes which were not declared will be subject to a final 35% tax calculated on the 35% on gross rental income apart from penalties and interest on unpaid tax.

Casolani said that because government made it clear that there was no room for tolerance on tax evaders, he believed that "with a good campaign, in parallel with a strict process, a big majority of tax-evading landlords will come in line".