Firstbridge Insights

Malta Budget 2021 – A Firstbridge Overview


The 2021 Malta budget speech, carried more weight, interest and value than any other budget in recent years. On the evening of Monday 19th October 2020, Malta’s Minister of Finance, Profs. Edward Scicluna presented a comprehensive message focused on outlining a series of plans and measures that were aimed at stimulating economic regeneration, supporting social segments and promoting a future with more technology, enhanced environmental sustainability and good governance for 2021 and beyond.

As we all continue to adapt and react to unprecedented times and all that comes with it, the continual balancing act between medical and economic safeguards continues to develop. The measures announced on Monday night focused on various aspects and key components; the Firstbridge Advisory team has carried out a detailed analysis of the Budget document in order to highlight the salient points that may be of interest to various businesses and individuals alike. The key highlights have been listed below:

Social Measures

Cost of Living Adjustment and Pensions

In order to cater for the increased cost of living, a 2021 COLA increase of €1.75 shall apply, and pensions are to increase by an additional €3.25 per week.

Additional Vacation Leave for Employees

For the fourth year in a row, in compensation of public holidays falling on an employee’s day of rest, employees’ Vacation Leave entitlement shall increase by an additional day (8 hours) on the basis of a full-time equivalent working schedule, resulting in an increase from the current 216 hours (27 days) in 2020 to 224 hours in 2021 (28 days).

Government Spending Vouchers

A second set of Government Spending Vouchers are to be issued in the new year. All qualifying individuals (aged 16 and over) shall receive a total value of €100 in vouchers to be split €60 to be spent on catering & accommodation establishments (compared to previous €80) and a further €40 to be dedicated to retail spend (previously €20).

Subsidy for Senior Citizen Care from Home

The “Carer at Home” Scheme launched in previous years shall have an increased maximum threshold support of €6,000 compared to the previous €5,291.

Tax Refunds

A series of tax refunds shall be issued in 2021, ranging from €40 to €95 based on level of income and marital and parental status.

Children’s Allowance

An increase of €70 per child shall be applicable to all qualifying families earning less than €25,318 in household income, whilst a €50 per child increase shall be applicable to all other qualifying families earning more than €25,318 in household income.

Business Measures

Covid Wage Supplement

Covid Wage supplements shall continue to apply until March 2021, albeit under different qualifying criteria, primarily focusing on revenue figures.

VAT Exemption Thresholds

Exempt Thresholds for VAT are to be increased from €20,000 to €30,000.

EU Funding & Malta Enterprise Schemes

EU Funding schemes focused on business growth, development and innovation promoted by Malta Enterprise are to be extended.

Reduced Rate of Stamp Duty on transfer of Family Businesses

Transfer of Family Businesses shall continue to carry a reduced rate of stamp duty of 1.5%.

Digital Think Tank

Various digital economy initiatives are to be introduced over the coming years. The plans mentioned in brief shall be focusing primarily on the introduction, support and development of various technologies including Virtual Reality, Augmented Reality, 3D-Printing and High-Performance Computing.

Start-up Support

Activities & initiatives are to be launched to continue to drive and establish Malta as a more developed Start-up destination.

Property & Real Estate

First Time Buyers Scheme

The first-time buyers’ scheme is being extended, and the 0% stamp duty threshold is being increased to €200,000 from €175,000.

Second Time Buyers Scheme

Although no changes in the structure, the Second-Time buyers’ scheme is being extended for an additional year.

Reduced rate of Stamp Duty on acquisition of own residence

A reduced rate of stamp duty of 3.5% shall be applicable for individuals acquiring or inheriting a property for the establishment of their own residence on the first €200,000.


Download a copy of Firstbridge Overview of the budget here:

Firstbridge Budget 2021


Contact us : Should any of the schemes and initiatives above be of interest to you and / or your organisation, please do not hesitate to contact us for further information on [email protected]