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Malta Budget 2021
28 Oct 2020

Malta Budget 2021

After four consecutive years of surplus, Malta is set to experience an estimated deficit of 9,4% of its GDP. This percentage, although above the Eurozone average, is still lower than some other countries’ predicted deficits, such as Italy or Spain (both above 10%). To combat this, the Maltese Executive plans to introduce several changes to its State Budget for 2021. Above are highlighted some of these changes:



The economic focus shall be to prioritize investments in public infrastructure, such as road networks, industrial clusters, and health and education facilities. A 10-year strategy will be introduced for the revamping of the tourism industry, as well as a continued commitment to green, carbon-neutral and sustainable energy policies. Furthermore:

  • No new taxes shall be introduced for the fourth consecutive year;
  • Income tax refund paid in the previous 3 years will be renewed for individuals earning less than €60,000 and see an increase to between €45 and €80 for single people, and €50 to €95 for married couples;
  • VAT exempt threshold for businesses to rise to €30,000;
  • The wage supplement given to pandemic-affected businesses is set to continue until March 2021.



  • With effect from 20 October 2020, first time property buyers will be exempt from duty on the first €200,000, an increase from €175,000;
  • Individuals who inherit the property in which they currently reside shall pay 3,5% duty on the inheritance, up to a €200.000 maximum;
  • Extension of emphyteusis on commercial properties will be possible if there is to be investment on the property;
  • The reduced rate of tax (15%) on the first €100,000 of gains or profits derived upon the transfer of any right acquired through a promise of sale agreement, shall now apply to the full amount of gains or profits derived with respect assignments of rights affected during 2021.


Other Relevant Changes

  • The cost of living adjustment (COLA) is set to €1,75;
  • An additional day of leave is to be granted in 2021, to better accommodate work/life balance;


For a more extensive analysis on the Malta Budget 2021, we recommend the following link.