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MaltaToday 3 November 2024

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3 BUDGET2025 maltatoday | SUNDAY • 3 NOVEMBER 2024 THE flagship measure of Budget 2025 is the widening of income tax bands, which will translate into an effective tax cut for all categories of taxpayers. It is the single most impor- tant measure that will leave more money in the pockets of middle-class families. The tax refund mechanism introduced a few years ago will also be re- tained next year, ensuring that even those who do not pay tax because their income falls be- low the taxable threshold, will also receive a financial injec- tion. Social measures introduced in past budgets have been re- tained, including the €500 grant to the families of children who continue studying beyond ob- ligatory school age. But families with children will also experience a boost in in- come through higher payments for children's allowance. Pensioners will see their CO- LA increase topped up with an additional €2.76 for a weekly in- crease of €8. Overall, the budget gives peo- ple and families a boost in in- come, although it may have fallen short of the measures and long-term plans necessary to make the leap in quality the gov- ernment has been talking about. The latter is likely to be laid out in several strategy documents and plans that will be published over the coming weeks, notably a labour migration policy and a transport masterplan. The following are some key measures from Budget 2025. Budget 2025: A boost to family income Income tax cuts • Single computation: Savings between €435 and €675 This category comprises 70% of taxpayers • Married computation: Savings between €345 and €645 This category comprises 14% of taxpayers • Parent computation: Savings between €375 and €650 This category comprises 17% of taxpayers • Income tax refund cheques of between €60 and €140 for those earning less than €60,000 will be retained in 2025. Children's allowance • Children's allowance will increase by €250 per child. This measure will cost around €16.5 mil- lion and will impact 42,000 families and around 63,000 children. • Apart from social security contributions, in- come tax payments will also be excluded from an individual's income when calculating eligibility to the higher rates of children's allowance. Pensions • Pensioners are to receive €8 per week increase, inclusive of COLA which is set at €5.24 per week. • Persons who did not have enough NI contribu- tions to qualify for a pension will continue to receive a bonus that was introduced in 2015. Currently, those who paid up to four years con- tributions receive €500 and those who paid be- tween five and nine NI contributions receive €600. A new measure will see these bonuses calculated according to the number of contribu- tions paid. These bonuses will range from €550 for those who paid up to one year's contributions to €1,000 for those who paid up to nine years' contributions. This measure benefits more than 16,000 people, mostly married women. VAT and excise tax • VAT on female sanitary products will reduce to zero. • Excise tax on low alcohol Maltese craft beers and wines will be reduced. • Excise tax introduced on vapes and refills. Other tit bits • Free six months gym membership for people born between 2005 and 2007. • Wedding grant raised to €1,000 per couple.

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