Finance Minister Tonio Fenech, presented the Budget 2013 in Parliament on this evening. The next step is the reply by Opostition Leader, Dr Joseph Muscat on the 5th of December.

The crucial vote for Budget 2013, requesting Members of Parliament for its approval, is due to take place on Monday, the 10th of December following the speech by the Prime Minister, Dr Lawrence Gonzi.

Some of the main highlights that have been announced in Budget 2013 are as follows:

Budget presented with measures aimed at creating economic growth and employment. A growth of 1.2% is envisaged for 2012 by the Government.

The cost of living adjustment will be €4.08 per week.

Minister says more than 20,000 jobs have been created. Unemployment in Malta was at 6.5%, the EU stood at 10.5% and eurozone 11.4%.

Government to continue to invest in employment and to generate job oportunities. Government to invest €14 million in incentives for industry.

Industrial estates are to be maintained, at an ivestment of €17 million. Three child care centres are to be built.

Malta Tourism Authority allocation to be increased to €37 million. Air Malta to receive €40 millin in support, in line with the EU agreement.

Etra schemes to help SMEs also announced.

An ERDF Scheme for Gozitan businesses.

Incentive guidlines for hoteliers to be reviewed, which includes incentives for 3* hotels. Revision of licences related to property in Gozo.

Further promotion of Maltese and Gozitan touristic product through innovative and technological means.

The former Malta Shipbuilding in Marsa is to be developed into a maritime park.

Home buyers evaluations witll be carried out by the bank’s architect. On properties with a value of more than €250,000, the purchaser and vendor can send the department architect to estimate the value of the property, before the signing of contracts. The present choice on paying capital gains tax or 12% final witholding tax is extended from 7 to 12 years as from 2013 dministrative reform related to property valuation:

Couples or persons purchasing the first residential home taking out bank loans will be able to provide the bank architect property valuation

In case of properties whose value exceeds €250,000, before signing of contracts the seller and buyer may request the department to send its architect to issue price valuation on which stamp duty is paid. This valuation remains valid for 6 months from date of issue.

3.5% stamp duty ceiling for first time buyers is increased from €116,468.67 to €150,000.

On transfer of properties in cases of inheritance from parents to their children, stamp duty will be eliminated.

For First-time Buyers, the first three hundred applicants will qualify for subsidised 2.5% interest rate on bank loan for first 8 years. These will receive up to €14,000 in subsidy.

Part-time or full-time workers earning less than €300 per week will also be able to enroll in an ETC scheme for training purposes.

Income tax is to be reduced from a maximum of 35% to 25% and will increase the tax bands for persons earning up to €60,000 annually over a 3-year period.. 2013 the rate applicable will be 32%, 2014 the rate applicable will be 29%, 2015 the rate applicable will be 25%.

The child allowance will be increased to €450 a year. This will be for the benefit of 29,000 children in 20,400 families, the Minister said. “The government believes that those families with children that would not benefit from the Income tax reduction announced, need support. therefore families that are classified as minimum wage earners and who are eligible for children’s allowance will receive the maximum allowance of €1155.90 allowance. It is estimated that this will affect 1680 children and 1110 families.”

Government to continue to offer incentives so that women are able to continue working. The maternity leave is to be increased from 16 weeks to 18 weeks as from 2013.

Local councils are to receive an additional €1 million in 2013, which will increase the total allocation to €32.4 million.

Further initiatives are to be offered to encourage the use of photovoltaic panels and solar water heaters. Extension of Solar Water Heater rebate (40% up to max. €400 ),15.25% rebate up to €1,000 on double glazing and roof insulation. These schemes will be partially financed through increase in excise duty on fuel consumption of 2c per litre on petrol and diesel and 5 euro per tonne on cement.

Plan to provide each household with water conservation apparatus.

Continuation of flood relief project, through an investment of €56 milion through underground tunnels. This will increase water storage by 700,000 cubic metres, over and above today’s 210,000 cubic metres.

Several projects have been carried out by the Government, including the Cirkewwa Terminal which will start operating shortly, the Minister said.

Vehicle registration tax on those vehicles with Euro 5 emissions will be reduced up to a maximum of 30%. Registration tax on vehicles under a Euro 4 standard will increase on average, by 10%. Registration tax on non-EU car imports, that are 5-years old or over with emissions of 130g/m will go down to € 1000.

Tax on Category NI commercial vehicles will be reduced by 12.5%. Tax on motor-cycles with an engine up to 250cc will be removed. Motor cycles with a larger engine, tax will be reduced by 25%.

500 euro scrappage scheme for new private or commercial (N1) cars on scrappage of older vehicle.

Removal of registration tax on classic cars aged 50 years and over.

Classic car definition is lowered from 35 to 30 years.

Removal of annual circulation licence for classic cars. Replaced by administrative fee of €8.

Rebate scheme of €200 for conversion of cars to autogas.

Reduction of annual licence for autogas powered cars registered after 2009

Extension of TM licence regularisation scheme

The government is to invest €250,000 in financial assistance to animal sanctuaries, which is up from €200,000 to date. €400,000 will be given to farmers as a subsidy on animal feed to counter the increase in international prices and control the upward pressure on food prices.

Provision of VAT exemption on diesel to fishermen.

The Minister said that in collaboration with the Gozo tourism association, the Government is budgeting € 2000,000 on ferry fees for those who spend a minimum of one night in Gozo between the months of November and February.

Further investment in Gozo General Hospital. Provision of chemotherapy, establishment of dementia unit, house for patients with mental problems and elderly night shelter.

Also on Gozo the Government will be working on development of Local Employment Development Unit in Gozo to strengthening work carried out by the ETC.

The ETC is to launch a scheme for Gozitans who are unemployed to receive training for a definite period. This will aid approximately 200 Gozitans.

Development of business centre for financial services and ICT companies.

Development of Child Development Centre in Victoria to offer health and educational services to children with specific needs.

The continuation of infrastructural works at Zewwieqa and Citadella.The continuation of international marketing campaign related to diving and implementation of Diving Master Plan.

The introduction of domestic tourism scheme. Between November and February, those spending a night in a licenced accomodation in Gozo will pay the same Gozo Channel tariff applicable to Gozitans.

The reconstruction of Marsalforn breakwater, works on Marsalforn Waterfront and Xlendi Waterfront.

Extension of High Energy Users Scheme to Gozitan industry.

The education budget is increased by €12m to €390.7 million. The continuation of Get Qualified scheme which provides a tax rebate for students paying to obtain their academic qualification.19,000 students are receiving 23 million in stipends.

A further increase in health expenditure of €38 million, to a total of €465 million.

All social benefits will increase by the COLA amount, ensuring that around 112,000 persons do not lose out on any benefits.

Energy benefit: Gas price allowance to increase from €30 to €40.

Extension of Pharmacy of Your Choice in order to cover remaining localities over the next two years

Roll out of IVF services in favour of eligible couples.

Continuation of Oncology Centre works.

Agreement reached by the Government with the UK and Italy for Maltese patients to be treated there. The Government has also launched the national colorectal screening programme and is working on the oncology centre as part of the Mater Dei Hospital. A progamme for vaccination against cancer in the uterus an a national policy against obesity and sexual health are also to be launched.

Increase in 6% on excise duty on cigarettes and 8% on tobacco.

Continuation of pension reform: contribution credits will be provided to parents born between 1.1.52 and 31.12.61 that quit their job to raise their children. Since these parents will experience an increase in the number of contributory years from 30 to 35, they will benefit proportionally as those parents born after 1.1.1962

These parents will benefit from credited contributions for every child, and in case of children with disability will receive two years ‘contributions should the parent (mother or father) had quit their job to raise their children and eventually returned to work as is the case for parents born after 1.1.1962.

More forms of disability will be eligible for this pension.

Introduction of one mechanism to determine whether a person qualifies for the Special Disability Card or for registration with disability register at ETC.

Two married people with a disability that got married before Jan 2007 will be entitled to same pension as those who got married after that date.

Tax reduction for persons with a disability paying fees for residency services in respite centres. This benefit applies to parents if they are responsible of such payment. Max deduction of €2500.

Residence for persons with a disability with voluntary sector in Gozo.

Extension of work scheme with local councils to cover NGOs and other Government entities to create 150 more jobs for persons with a disability, 50 of which are in Gozo.

Setting up of residential home to avoid separating siblings at cost of €300,000.

Establishment of therapeutic facility that offers security to children with behavioural problems (€400,000.).

Support programme for youths exiting residential care in terms of provision of temporary / permanent residence and assistance in this transitional phase.

Opening of 2 Access Centres, in Gozo and Birkirkara €200,000.

Voluntary work: Introduction of stipend for young people aged up to 25 or for those who up to three years after graduating from tertiary education spend a year performing voluntary work with a €600,000 vote.

SSC credits for young people performing voluntary work in Malta or abroad. These credits will cover a period not exceeding 5 years since their return to the job market for more than five years.

NGOs conforming with the NGO Act (2007) will be tax exempt.

€70,000 to the Council for the Voluntary Sector to support NGOs in performing a number of projects in their area and scope of action.

€300 allowance announced last year for persons aged 80+ is extended to those aged 78+ and eventually to those aged 75+.

Full COLA increase to the elderly.

Revision of Supplementary Assistance for those aged 65+ in cases where household income is below the risk-of-poverty threshold, to ensure that this category is covered by a higher Supplementary Allowance.

Service Pension initiative is continued through a further increase of €200 in the exempted amount. In total the exempted amount has now reached €1,266 per year .

Extension of Pensjoni tal-Wens.

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