The government is seeking to raise additional revenue from tourists and third-country nationals (TCNs) as it looks to reduce the deficit and public debt, which has exceeded €12 billion, under its 2027 Budget, branded "Malta Miegħek".
Finance Minister Clyde Caruana yesterday announced a series of measures targeting visitors and foreign workers, including significant increases in eco-contributions, higher fees for work permit applications and the withdrawal of certain benefits from TCNs who have not been long-term residents.
From January 1, the eco-contribution paid by tourists staying in hotels will increase from €1.50 to €8 per night, subject to a maximum of €64. Those staying in short-let accommodation will pay €10 per night, up from €1.50, with the contribution capped at €80.
The higher eco-contribution will also apply to cruise liner passengers, while visitors to Comino will be charged a new €5 contribution. Tourists using the fast ferry will also face a €3 increase in the ticket price, while the price for non-residents travelling on the Gozo ferry from Cirkewwa will also rise - up from €4.65 to €11 for an adult and from €1.15 to €7 for a child. A single travellet with a car will pay €22 instead of €15.70.
The measures could also reflect an effort to attract higher-spending visitors, with the government seeking to generate more revenue from tourism while managing the impact of visitor numbers on the country's infrastructure and environment.
Employers recruiting third-country nationals will face higher costs, with the fee for new work permit applications increasing from €600 to €800. A new tariff of €400 will also apply to new applications and renewals.
TCNs will also lose access to free public transport and free childcare unless they have been resident in Malta for at least five years.
The measures form part of a budget that combines efforts to strengthen public finances with increases in household benefits and support for vulnerable groups.
The cost-of-living adjustment will amount to €6.41 per week, while the minimum wage will increase by €10.41 per week.
Pensioners will receive a €10 weekly increase, inclusive of the cost-of-living adjustment. They will also benefit from a €21.53 increase described as a COLA bonus, on top of the pension increase.
Other social measures include allowing partners to transfer National Insurance contributions between them and increasing the carers' grant to a maximum of €7,500.
The adoption grant will rise by €1,000, while foster parents will receive an additional 10 days of leave paid for by the government.
All therapies for children with disabilities will be provided free of charge, with the government covering the cost.
On the business front, the corporate tax rate will be reduced to 25% for companies with a turnover of less than €1 million.
The budget, therefore, seeks to balance additional revenue from tourism and foreign labour with measures intended to support households, pensioners, carers and businesses. Energy and fuel subsidies remain untouched, although the government is being urged by the business community to plan their eventual removal.