Budget 2018 appears to begin addressing certain problems in the economy whilst shying away from the real problems affecting the economy.
In his Budget speech Finance Minister Edward Scicluna announced various measures that should supposedly help the rental market stabilise. However the registration of rental contracts as well as a subsidy for those properties which lie abandoned will certainly not stymie the constant and inexorable increase in rental prices.
The extension of tax exemptions to second time buyers of property is also welcome although the ceiling of 3,000 Euro is somewhat low considering that second time buyers will opt for something more expensive. The building of 700 new social housing units is also welcome although that project is funded by the European Investment Bank.
Tax rates have not been touched with small refunds being offered on those who earn less than EUR 60,000 a year – that’s almost 90% of the population in any case. The Cost of Living Increase is also minimal at EUR 1.75 however the increase in pensions of EUR 2 a week as well as the minimum wage adjustment is also welcome.
As regards infrastructure, very little is being proposed apart from the widening of the some major roads and a new roads agency. Government is also proposing building four new schools in strategic areas – so that’s a welcome investment.
Small business incentives have also been increased but on the whole this Budget may be seen as solid without much bravado although the issues facing the environment especially with regard to rampant construction activity still need to be seen over the years to come.