Summary of 2025 Malta Budget

On a general note, one of the major highlights is the tax cut specifically targeting the middle class. Workers earning between €20,000 and €25,000 annually will see the largest benefits. The budget includes increases in children’s allowances and pensions, helping to alleviate cost-of-living pressures for families and retirees.

To manage inflation and stabilise household expenses, energy and fuel subsidies will remain in place, which are expected to cost around €350 million. This move aligns with the government’s previous stance of supporting families against volatile global energy prices. The government has expanded its AI-driven tax audit system, which has already helped recover an additional €300 million from tax evaders. This initiative aims to improve efficiency and transparency in tax collection.

Malta’s dependency on foreign workers, especially third-country nationals, remains a priority, with the government recognising both the economic contributions and the need to balance this with the strain on infrastructure and public services. This budget represents a push towards improving Malta’s middle-class welfare, economic sustainability, and enhanced revenue through better tax compliance mechanisms.

Below you will find a summary of the Budget in relation to workers, property, energy and business industry. The following data and insights regarding Malta’s 2025 Budget, including specific figures and policy details, are sourced from Times of Malta. We acknowledge and appreciate their reporting on national economic policy developments, which has informed the understanding presented here.

Working Force

• Income tax bands widened, promising to save each worker at least €475.
• Cost of Living Adjustment (COLA) for 2025 will be €5.24 per week.
• €48m worth of COLA Plus payments to be given to 100,000 households, each receiving between €100 and €1,500 each year. This measure is identical to the measure introduced in last year’s budget.
• Minimum wage to increase by €8.24 per week, to reach €221.78 weekly, as previously agreed with social partners.

Property

• OHSA to open a new branch in Gozo.
• Existing fiscal incentives to be renewed, including restoration grants for older properties in conservation areas.

Energy

• Existing grants for photovoltaic panels, battery storage and solar water heaters, among others, to remain in place.
• Work on offshore wind turbines and second interconnector to continue.

Industry

• Incubator to help startups expand their operations to be set up in ?al Far.
• Work on SME park in ?al Far to continue, aimed at panel beating, carpentry, and spraying services away from residential zones.

If you would like more information on how the 2025 budget might impact your business in Malta, please feel free to reach out to us atinfo@fairwindsmanagement.net.

Fairwinds Management Limited is a MFSA licensed firm offering Business Solutions in Malta. As part of our services, we offer Accounting, Administration, Corporate and Legal solutions.  Fairwinds Management also manages the brand Accounting Services. More information about us and our key services please visit our website. You may reach Fairwinds Management on +356 2704 0903 or info@fairwindsmanagement.net.

Article written by Ms Charlene Sciberras, B.A. (Hons), guest writer, a marketing and business administration specialist with a special focus on corporate, accounting, and legal matters.