Malta Budget Set For October 18

by Robert Lee, Tax-News.com, London

05 October 2006

It emerged this week that the Maltese government will present its budget on October 18.

Speaking at the weekend, Prime Minister, Lawrence Gonzi promised a "responsible" budget, and pointed to the government's achievements so far.

“Investment has increased; revenue from national insurance has gone up as more people are working and revenue from income tax has increased also even though the rates have remained unaltered,” he observed, according to the Malta Media news service.

However, the Nationalist Party has come under fire from Alternattiva Demokratika, the Maltese green party, over the proposed Lm8 million it will be distributing in the budget.

AD has argued that by increasing the rate of taxation for banks and telecoms firms to 40% (from 35%), and clamping down on tax evasion and social security fraud, the government could find itself with as much as Lm18 million to spend.

The opposition party went on to suggest that the additional funds could then be invested in measures designed to benefit the country's poorest families, in addition to a stepped reduction in the income tax rate on small companies from 35% to 30%.

AD additionally suggested that the departure tax should be removed and replaced with carbon tax of Lm10.

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