Nationalist Party MPs Graham Bencini and Adrian Delia on Tuesday accused Prime Minister Robert Abela of misleading pensioners over a tax exemption announcement made during a political activity in Naxxar last week, saying that a recently published legal notice contradicts Abela's statement that pensioners with another income, including from rentals, investments and part-time work, will no longer pay tax on this income.
Addressing a press conference, the two PN MPs argued that the government's claims that pensioners who continue working will be fully exempt from income tax are not reflected in the legal notice published on 3 March.
Bencini referred to Legal Notice 53 of 2026, which deals with pensions and tax exemptions, saying that the measure does not exempt pensioners' total income from taxation but only applies to income derived from pensions.
He explained that according to the legal notice, pension income derived in the year immediately preceding the year of assessment 2027 (basis year 2026) and subsequent years, shall be fully exempt from tax up to €37,104.
Bencini said that the exemption applies only to pension income, and not to all income earned by pensioners, with such income remaining taxable.
Bencini also questioned how many pensioners actually receive an annual €37,104 pension income, as most receive much less.
He said that only pensions up to a max of €37,104 are exempt. Bencini said that Abela had said that all income earned by pensioners up to a max of €37,104 are exempt.
The measure, Bencini said, would also not apply to pensioners who earn income from other sources, such as employment, dividends or investments.
Delia said that the measure had originally been announced in the last Budget, when Finance Minister Clyde Caruana indicated that pensioners who continue working beyond retirement age would benefit from tax exemptions and changes to the income bracket.
However, Delia said that during a recent political activity, the Prime Minister went further, claiming that pensioners would enjoy complete exemption from income tax on their income.
He said that while the legal notice mirrors what Finance Minister Clyde Caruana had previously indicated in the Budget, the Prime Minister's statement suggested a broader tax exemption than what the measure actually provides.
Delia played a video clip of Abela speaking at the event, where the Prime Minister said pensioners who continue working would go from paying tax rates of up to 35% to zero, describing it as "complete tax relief."
"That is not true," Delia said, arguing that the legal notice contradicts the Prime Minister's statement.
He said the measure does not cover pensioners who earn additional income through work, investments or dividends, including those who had saved or invested during their working lives.
Delia also said that the Abela was stating "fictitious benefits" that would not materialise in practice, particularly for pensioners who were led to believe they would save thousands of euros per year.
"There are around 100,000 people at risk of poverty, many of them pensioners," Delia said, arguing that they were being misled about the extent of the measure.
Delia accused the Prime Minister of exaggerating the benefit for electoral gain, saying the discrepancy between Abela's statements and the legal notice shows that the government is promising benefits that are not fully reflected in the legislation.
He said that in cases where the Prime Minister's statements differ from those of Caruana, it is generally the Finance Minister's position that is reflected in the final legal measures.
Delia said the PN would hold the Prime Minister accountable for the announcement.
"He must either implement what he promised or apologise to Maltese and Gozitan pensioners and correct himself," Delia said.
Delia added that only a small number of pensioners would actually fall within the income brackets as established in the legal notice.
Delia said that the announcement appeared to be part of what he described as a premeditated attempt to attract votes ahead of the next election, before the real impact of the measure becomes clear next year.
PN against a measure leaving another €25 million in the pockets of 16,000 pensioners, PL says
In response, the Labour Party said that the PN having "left the pension in the freeze for 25 years is a well known fact but now we also know that it is against a measure that leaves a higher income of pensioners that will not be taxable. The Opposition has today expressed that it is against a measure that the Labour Government has introduced over five years and that will leave a further €25 million in the pockets of 16,000 senior citizens."
"The press conference held by the Opposition in the afternoon exposes the Nationalist Party's lack of credibility in pensions." The PL said that a Nationalist Government had even taxed pensioners, "and those who had other incomes equal to twice the maximum pension would have been eroded by 35% of that income."
"Today with the measure completed over five years, a pensioner with an equivalent additional income up to the maximum pension, will not pay any tax. Those who have increased the years covering NI contributions and created discrimination with pensioners born before 1962 cannot be taken seriously," the PL said.
"It is a Labour Government that is granting the 11th pension increase and repairing injustice with pensioners born before 1962. Today the minimum pension has reached the maximum that a Nationalist Party had left in the Government. Pensioners know what track record Alex Borg's party has and know the guarantee that a Labour Government led by Robert Abela will give them," the PL said.
Government statement itself contradicts Robert Abela – PN
The PN said that shortly after the press conference, a government statement had “confirmed the lie.”
“A few days ago, Robert Abela said that pensioners would not pay a single cent in tax on income they have apart from their pension – whether from investments, rental income, interest or from work they carry out after reaching retirement age,” the PN said.
The statement issued by the Minister for Finance shortly after the press conference held by the PN “confirms that what Abela said was nothing but a lie, as it makes it clear that any pensioner with other income will continue to be taxed on that income in the same way as they are today.”
In fact, it states that “any other income (only) received by a pensioner will be taxed at the normal rates”, the PN said.
“Robert Abela has now been contradicted twice: first by Legal Notice 53 of 2026 published by the Government, and then by his own Minister for Finance through a statement,” the party said.
The Prime Minister should apologise to pensioners for lying to them and attempting to mislead them, the party said.
In response, the PL said that the only party which should be apologising is the PN to all pensioners for voting against them having their pension increased for the 11th time.