Issue link: https://maltatoday.uberflip.com/i/1177088
17.10.19 9 EDITORIAL BusinessToday is published every Thursday. The newspaper is a MediaToday publication and is distributed to all leading stationers, business and financial institutions and banks. MANAGING EDITOR: SAVIOUR BALZAN COORDINATING EDITOR: PAUL COCKS CONTRIBUTING JOURNALISTS: MASSIMO COSTA | LIAM CARTER BusinessToday, MediaToday, Vjal ir-Rihan, San Gwann SGN9016, Malta Newsroom email: bt@mediatoday.com.mt Advertising: afarrugia@mediatoday.com.mt Telephone: 00356 21 382741 B udget 2020 has a strong social slant as it addresses the needs of vulnerable people with targeted measures that will improve their finan- cial situation. ese measures may be meaning- less to many people unaffected by ill- health and disability but will go a long way to lift up the vulnerable. e spotlight cast on the elderly was also a welcome move to alleviate the inflationary pressures caused by a buoyant economy. A weekly increase in pensions of €7, free public transport for those 75 and over, and an increased bonus of €350 for those aged 80 and more, are three measures that will improve the stand- ing of elderly people. e social emphasis was important to ensure the wealth generated by economic progress reaches the most vulnerable sectors of society. But there is also the need to keep the middle class in focus. e incoming Labour administration of 2013 gave the hard-working middle class a sig- nificant injection when it cut income tax rates for three years running, re- duced water and electricity tariffs, and introduced free childcare for working parents. ose measures, and others, gave the long-suffering middle class a boost. With more cash in hand, consump- tion grew and the economy started to rev up. However, the impact of that cash injection has been slowly wearing off and one would have expected a fresh injection in this budget to restore the spending power of the middle class that earns more than €20,000, does not depend on social assistance, and is beyond childbearing age. e government has been living up to its commitment of handing back a tax refund but for the third year run- ning, this has remained static, ranging between €40 and €68. According to the Labour Party pledge, the refunds will gradually go up to a range between €200 and €340. So far, there has been no gradual in- crement. With a surplus in the consolidated fund of €114 million, Edward Scicluna could have spared another €11 million to double the range limits to €80 and €136. is would have represented a more moderate cash injection to many fam- ilies and individuals. Having said this, the introduction of a flat tax rate for overtime was impor- tant to address the situation of those on the lower wage scales within the middle class. Workers earning up to €20,000 will have the first 100 hours of overtime per year taxed at 15%, rather than in- clude the extra hours as part of their ordinary income and have them taxed at normal income tax rates. e meas- ure will ensure workers will be left with more cash in hand. is will encourage workers to take on overtime with the company they work for, rather than refuse it and opt for a part-time job. From the em- ployers' perspective, this is a positive measure because it has no impact on competitiveness. e other measures to pay out a €300 baby bonus on the birth or adop- tion of a child, the interest-free loan to cover the 10% deposit on property purchases for those who do not afford it, and the widening of parameters for the refund of stamp duty for first-time home buyers, are positive measures targeting particular circumstances in a person's lifespan. ose in the middle class who find themselves in these circumstances will also benefit from these measures. But in the years to come, a more con- certed effort is required to ensure that the middle class regains the strength of its purchasing power. The middle class will have to wait