On the 8 June, the Prime Minister, the Minister for Finance and Financial Services and the Minister for the Economy, Investment and Small Businesses announced a package of measures intended to regenerate the economy following the COVID-19 pandemic and this by implementing measures targeted to reduce operational costs of businesses, measures to incentivise domestic consumption and measures to support investment.
A summary of these measures is set out below.
The current COVID-19 wage supplement will be extended in the following manner:
30% of MicroInvest tax credits available to businesses during 2020 will be converted into cash grants up to a maximum of €2,000. The capping will be increased to €2,500 for undertakings operating in Gozo and for female-owned undertakings.
The Final Withholding Tax rate on sale of property will be reduced from 8% to 5% and stamp duty rate on acquisition of property will be reduced from 5% to 1.5%. In both cases, such reduction applies on the first €400,000 of the value of the property. This reduction applies where the final deed of sale is published by the end of March 2021.
This reduction will also apply to property transfers where a promise of sale agreement has already been concluded.
Possible relaxation of conditions related to the exemption from stamp duty applicable to first time property buyers.
Maltese and Gozitan resident persons over 16 years of age will be granted vouchers for a total of €100. €80 of such vouchers can be used on services provided by MTA licensed businesses (such as hotels, restaurants and bars) and the remaining €20 in shops which were closed by order of the Superintendent of Public Health during the COVID-19 period, such as retail shops. The vouchers will be valid until September.
With effect from Monday 15 June, petrol and diesel prices will be reduced by 7 cents per litre. Consequently, the price of petrol will be reduced to €1.34 per litre whilst that of diesel will be reduced to €1.21 per litre.
The tax payment deferral scheme will be retained until September, with the deferred payments then being required to be settled over a period of 12 months.
However, as from 1 July no deferral will be allowed for the settlement of employees’ Final Settlement System tax and social security contributions withheld from wages.
The maximum in-work benefit given to encourage parents to go to work will be increased to €1,400 per child (where both parents work) or €630 per child (where only one parent works or for single parents).
In addition, a one time supplementary in-work benefit amounting to €250 will also be given to each family that is already currently receiving the in-work benefit.
The details of these measures are still being communicated and further clarifications will need to be sought. We are continuing to follow developments and will provide updates as these become available.
In the meantime, please do not hesitate to contact one of our specialists for further information or should you wish to discuss the effect of these measures in your specific circumstances or in those of your business/enterprise.
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At the back, from left to right:
Steve Gingell, David Ferry, Mirko Rapa and David Valenzia
In front, from right to left:
Neville Gatt, Bernard Attard and Mark Lautier