Budget Highlights 2016

Budget Highlights 2016

The 2016 budget presented in parliament by the Minister of Finance Dr.Edward Scicluna is a very similar budget to the previous budget presented in parliament (budget 2015).  This budget seeks to continue to promote economic growth on the Maltese islands.  In fact the 2016 budget is titled ‘Malta – Ekonomija b’Saħħitha’ (Malta – A Strong Economy’.

Income tax for individuals

  • Individuals with single tax rates and earning up to €9,100 will not pay tax.  Those paying till €19,500 will save €90 each year.
  • Couples with married tax rates earning up to €12,700 will not pay tax.  Those paying up to €28,700 will save up to €120 each year.
  • Parents earning up to €10,500 will not pay tax.  Those earning up to €21,200 will save up to €105 each year.
  • Coaches and players of any sport will have a reduced income tax rate of 7.5%.
  • Any “extra duty” carried out by police officers will be taxed separately at a rate of 15%

Fiscal measures applicable to immovable property

  • Commercial property will also benefit from final 15% tax rate on gross rental income (excludes intra group rent arrangements)
  • Final tax rate o transfers of regenerated immovable property situated in Urban
    Conservation Areas will be reduced from 8% to 5% of the transfer value.

Tax Credits

  • Micro Invest Scheme extended to provide a maximum tax credit of €50,000 to self employed women and businesses the majority of which are owned by women.
  • Tax credits will be given to enterprises which employ individuals with a doctorate or reading for a doctorate in science, ICT or engineering.  These enterprises will be eligible to a maximum tax credit €10,000 (if the period of employment is at least 12 months).

Fiscal consolidation

  • This allows for a group of companies owned by the same persons to compute taxable income on a consolidated basis as if it were a single company.




  • The deficit is expected to be 1.1% of GDP
  • The GDP is expected to rise by 4.2% (in real terms) to €8.5 billion
  • The inflation rate is at 1.2% (as at Dec 2015) and expected to rise to 1.8%
  • Unemployment is expected to decrease to 5.6% in 2016.