Malta Budget 2025

• Children’s allowance will increase by €250 per child irrespective of the income derived by the parents.
• In addition to overlooking the amount of social security contributions paid, the amount of income tax paid will also not be taken into account. This same approach will also be applied in relation to in-work benefits and the computation of the rates in the in-work benefits will be based on the income derived without taking into account the social security contributions and income tax.
• Special allowance for those who continue with their studies after the mandatory age amounting to €500 per year for three years will continue to be granted to parents whose children continue their education at a post-secondary level. 

• Birth of a child - increase in the birth and adoption bonus to €500 per child. The said bonus increases to €1,500 for the third born child or more in a family
• Marriage Bonus - increased to €1,000 granted between two spouses
• Self-Employed Individuals who undergo IVF treatment will be granted a benefit payment equivalent to a maximum of 60 hours at the national minimum wage rate for women and 40 hours at the same rate for their spouse
• Paternity Leave for self-employed - will be granted a benefit payment equivalent to 80 hours based on the national minimum wage to extend the paternity leave granted to employed prospective fathers to those who are self-employed
• Increase in the allowance for fostering - The fostering allowance will be increased to €120 per week for every child being fostered
• Families and Individuals with Low or Medium Income will be entitled to an additional payment of between €100 and €1,500 per year with the first instalment being made in December and the second payment granted in mid-2025

A new benefit will be created referred to as ‘Medical Social Assistance’ which will be specifically granted to individuals suffering from medical conditions that prevent them from working. In addition to the full cost of living adjustment, these families will receive an additional €5 per week for each family member.

• With the aim of helping more low-income families qualify for medical assistance, the income limits for couple and individuals will be widened and will be increased by €416 per year, in addition to the statutory increases given
• Revised means testing for Free Medical Assistance
• Pension increases excluded from means testing
• Automatic qualification for Pink Card for 75+ receiving Supplementary Allowance

The allowance for families with children who have physical or mental disabilities will increase by €5 per week, bringing it to €35 per week, or €1,820 annually. 

Carer allowance will increase with the full COLA that is of €8.24 per week.

• The Enhanced Severe Disability Supplement will see a weekly increase of €7.42, bringing it to €199.61. Severe Disability Assistance will rise by €3.49 per week, reaching €128.15, while Disability Assistance will also increase by €3.49, bringing it to €102.62. Enhanced Carers Assistance will go up by €5.24 per week to €179.02, and Carers Assistance will similarly rise to €125.92.
• Additionally, a new policy will benefit those caring for two family members with high or medium dependency. These carers, who previously received a single rate of Carers Allowance or Enhanced Carers Allowance, will now receive 1.5 times the standard benefit rate.

• The government announced an increase of €5 per week in the allowance granted to families with children with physical or mental disability.
• Additionally, the Carers Grant given to families with children with disability will be further increased to €5,190 per year.
• As from 2025, the carers grant will also be given to unemployed parents who take care of their children under the age of 16 and whose condition is considered as very severe and which require the constant attention to their parents
• Additionally, the government announced an increase in the tax credits given to parents of children with disability with the said tax credit going up to €750. This assistance will also be granted to parents who are presently unemployed or benefitting from social benefits and are therefore not due to pay any income taxes

• The Government will be allocating nearly €25million to over 50 Public Social Partnerships that the Government has with various voluntary organisations working in the social field.
• A one-stop-shop will be opened in the South of Malta, serving as a resources and research centre for the voluntary sector.
• The concept of a volunteer bank will be launched, allowing all those who wish to donate volunteer hours, including professionals, to join this national project. This bank will assist voluntary organisations in utilisation of these services, which will be collected in a centralised database.
• Enterprises that donate to voluntary organisations in the social, environmental and animal welfare sectors will be rewarded with a tax credit of up to €500

The government announced an increase in the maximum annual income by €1,000 across all categories for the purposes of the rent subsidy benefit in relation to social accommodation.

• First Time Buyers will continue to benefit from the scheme ‘Grant on First Residence’ and from a reduction in stamp duty.
• The reduction in stamp duty will also be extended to second-time buyers

• Two years of accredited social security contributions
• Support for successful program completion
• Employment reintegration assistance

• The Government has established the Climate Action Authority, which has already started operating with the role of leading a strategic plan on how the government will achieve its targets for a carbon-neutral economy by 2050. As part of this strategy, residents who invest in renewable energy systems and water purification equipment will be supported. 

• A new AI unit has been established, and the Government continues to support the creating of innovative systems through funding and research programs

• Malta is also preparing the necessary infrastructure for the Digital Identity Wallet, an initiative that will enable Maltese citizens and businesses to share their digital identity securely, easily, and efficiently. This wallet will be available as an app on smartphones.

• The government is focusing on expanding into new sectors, such as video gaming, esports, and immersive technologies. Video Gaming Gateway (initiative) provides financial support for innovative projects, while Basecamp supports start-ups in video game development and esports.
• In 2025, a visa for esports athletes will be introduced to facilitate talent mobility into the country. International teams, such as Furia and Talon esports, have chosen Malta as their European Base.

• Initiatives in place to encourage the establishment of back-office activities in Malta (administrative and support services). This includes both activities that require regulatory licenses and those that do not.
• The Highly Qualified Persons measure will also be extended.

• More open spaces throughout 2025 are planned to open, including potential development areas in Hal Luqa, Hal Lija, St. Julian’s and Hal Kirkop. These include 8,000 square meters of people-centred spaces in village centers. They form part of 19 projects that Project Green alone is expected to launch next year.

Incentivising further the purchase of vehicles which pollute less

Transition towards clean public and private transport 

1. From next year, the scheme for purchasing new electric vehicles will be extended, entitling anyone who buys a new electric vehicle, including motorcycles, to a grant ranging from a maximum of €2,000 for motorcycles to a maximum of €8,000 for cars and small vans, with some new conditions applying.
2. There will also be renewed the grant for scrapping old vehicles: €1,000 for cars and vans, with an additional €1,000 for scrapping old vehicles registered in Gozo. This scheme is planned to be funded by European Funds under the Recovery and Resilience Facility.
3. Moreover, customers who have ordered a new electric car by October 28, 2024, but for some reason, but not registered until 2025 will still be eligible to apply for this year’s grant of €11,000.
4. Electric vehicles and plug-in hybrids with at least 50 km electric range will remain exempt from registration tax and annual road license fees for five years from the first registration date. Grants for full VAT refunds on electric bikes and incentives for assisted bicycles will continue, along with support for converting petrol or diesel vehicles to electric
5. Other incentives: - The scheme for wheelchair-accessible vehicles (such as taxis) used for hire or compensation-based passenger transport, the conversion of petrol or diesel vehicles to electric vehicles and the scheme incentivizing the purchase of electrically assisted bicycles will also be renewed.
6. The Government will publish a national strategy focusing on cycling as an alternative mode of travel and implement the first phase of the CSAM (Connections for Safer Active Mobility) project, incorporating interventions such as creating bike lanes, pedestrian paths, and beautification zones in urban areas.
7. The Government has committed to invest in technology known as the Intelligent Traffic Management System to optimize traffic flow. The proposals also aim to strengthen the coordination of roadworks, improve public transport, introduce parking schemes, reduce dependency on private cars, and transition towards sustainable mobility. 

• Fiscal Incentives will continue for individuals who purchase or sell properties that have been built for over 20 years and have remained vacant for more than 7 years or properties that are located in an Urban Conservation Area (UCA). These individuals will continue to benefit from exemptions on Capital Gains Tax and Property Transfer Tax on the first €750,000 of the property price and will be relieved from VAT up to a maximum of €54,000 on the first €300,000 in restoration and renovation expenses.
• First-time buyers will receive a grant of €15,000 or €40,000 if property is bought in Malta or Gozo respectively.

There will be an extension of the Irrestawra Darek Scheme.

• A process to strengthen the land registration will be implemented through both legislative and administrative renewal. A scheme will be launched so that temporary property titles can be redeemed. This scheme will expand eligibility for existing and past schemes while introducing criteria to facilitate the conversion of temporary titles, allowing more residential properties to become freehold.
• The legal framework governing the administrative structure of the Joint Office will be strengthened, intended to enhance the work of this Office.