Malta's finance minister, John Dalli, delivered his budget speech for 2002 on Wednesday this week with the emphasis not on fiscal initiatives but on measures to boost economic growth.
New measures include the privatisation of Maltacom, the Malta Freeport, the Public Lotto and Malta International Airport. Expenditure in IT for SMEs will be allowed to be offset against profits in the same year in which they are accrued and a scheme promoting the agricultural industry will also be introduced next year.
The levy structure on exported and imported goods will be adjusted, in particular the tax on imported products for computer assembly will be reduced. Mr Dalli said he aims to continue removing levies; already this year he has lowered some 392 levies by 20 per cent, and from next January more levies are due be slashed by 30 per cent.
Slight amendments were made to income taxes regarding the income of married couples: non-taxable income has been raised by Lm100 to Lm4,100, and the first tax bracket of 15 per cent has been increased by Lm300 to Lm1,800. The second tax bracket of 25 per cent is set to be raised by Lm500 to Lm2,500.
Leader of the opposition Alternattiva Demokratika Party, Dr Harry Vassallo, described the budget as a 'bland budget of mixed messages.'
He said: 'The budget puts forward some improvements in certain areas, but is a severe disappointment for middle and low income earners, who get no tax relief for the third year running, despite inflation. There were basically no significant improvements in income tax rates, meaning that the situation of middle and low income earners will not improve. The savings netted in income tax ceilings for couples with joint declarations are insignificant.'
The full text of the budget address can be found at: http://www.doi.gov.mt/EN/archive/BudgetEng/budgetbanner.jpg
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