The newly announced measures for Malta’s 2021 budget introduce a number of new incentives, as well as grant extensions to existing schemes for businesses.

Here’s a breakdown of the most salient 2021 Budget incentives:

Covid-19 Business Support Measures

⁃ The wage supplement has been extended until March 2021 (same form maintained until the end of the year), will then be revised in 2021.

⁃ Another round of €100 vouchers will be available from Jan 2021, in denominations of €10 and €15. Share to be used in retail shops has been increased to €40.

Increase on VAT-exemption threshold

The threshold for VAT exempt businesses will go up to €30,000 from €20,000

Extension of business schemes

Extension and continuation of Malta Enterprise Schemes such as Micro Invest, Business Development and Continuity Scheme, Research & Development 2020 Scheme, the R&D Feasibility Study Scheme and the Business Start Scheme will be extended.

Innovation Projects Scheme to be launched

Malta Enterprise will be launching a scheme to support innovation projects by companies employing less than 50 employees, whereby they can claim up to 50% of their expenditure (with a maximum of €200,000).

Assistance for start-ups & tourism industry

The government will be introducing schemes to help business start-ups, to encourage online business, and to help firms attract new foreign investment.  Assistance will also be given in the tourism sector for marketing.

Extra day of leave

All workers in Malta will now be entitled to an extra day of leave, bringing the total leave time to 28 days per annum.

Grants for agriculture

Government grants will be awarded to farmers and fisherman, equivalent to what they pay in tax on sales at the vegetable and fish markets.  

Extension of tax concession on transfer of business

1.5% tax concession on transfer of business has been extended for another year.

First-time buyers scheme & Property donations

The first time buyers scheme for reduced tax on property value has been extended from €175,000 to €200,000. Taxes on property donations are now tax exempt now on the first €250,000.

New saving bonds

The government is also planning to issue new savings bonds with favourable interest rates, specifically targeting savers aged over 62.

Tax rebate cheque

Following the success of the previous year’s handout, the Government will be once again gifting workers on the lowest incomes with a €95 cheque (previously €68), while those in the top category, earning up to €60,000 will get a refund of €45.

Cost of living allowance increase

A €1.75 weekly wage increase will be given as a cost of living adjustment. This also applies to pensioners in full and pro-rata to students.

Want to learn more about how a particular development will be affecting your business? Get in touch today to speak to one of our advisors!