€5,000 tax concession for first-time buyers extended for another year

After exceeding its targets for this year, Malta is expected to achieve a growth rate of 3.5% in 2017.

After bringing down the deficit to 0.7% from a projected 1.1%, government is targeting to bring this down further next year.

In 2017, government is projecting a 0.5% deficit while national debt is expected to drop to 61% from 63% this year.

The Cost of Living Adjustment (COLA) mechanism will see wages increase by €1.75 a week.

Eco-tax substituted by excise duty 

Eco contributions on toiletries, detergents and batteries will be substituted by an excise duty.

An excise tax will also be imposed on non-biodegradable utensils and garbage bags. 

Tax on cigarettes will increase by 3% or at least 18c per packet, while tobacco will increase by 5.5%. Tax on non-alcoholic drinks, not including water, will increase by 2% or 2c per litre. 

A tax will be imposed on concrete and construction products, with the money raised going towards environmental projects.   

Tax refund on dividends 

Small shareholders (owners of under 0.5% of shares) who pay tax on dividends for companies listed on the Malta Stock Exchange will be entitled to a tax rebate. 

People who transfer ownership of family businesses to the next generation will see their stamp duty decreased from 5% to 1.5% for a single year. The first time buyers’ scheme will be renewed for a third year. 

First time buyers 

The €5,000 tax concession granted to first-time buyers will be renewed for another year, while people who buy old homes in urban conservation areas will be given a maximum grant of €100,000 to be used on restoration works. 

Stamp duty on the sales of all houses in Gozo in 2017 will be slashed from 5% to 2%.

All rental contracts will also have to be registered with government although tax on rental income will remain untouched at 15%.