Tax credits for small businesses in Budget

The government will announce tax credits for small businesses in tomorrow's Budget, The Sunday Times has learnt.

An estimated 30,000 businesses, which employ less than 10 workers each, will benefit from the measure as the government attempts to boost employment. Business owners will be able to take advantage of tax credits if they take on more employees, renovate their structures and invest in new equipment, sources said.

The government is also expected to introduce a microfinance scheme funded by the European Union. Microfinance is the provision of financial services to low-income clients, small businesses and the self-employed.

Over 140 companies will also benefit from €8 million from the second instalment of the European Regional Development Fund.

As well as complaints about hefty water and electricity tariffs, employers have objected to the cost-of-living allowance expected to be announced tomorrow.

When contacted yesterday, Finance Minister Tonio Fenech said the 2010 Budget would focus mainly on the creation of jobs.

"We need to address the international economic crisis and therefore we must incentivise work through businesses at large," Mr Fenech said.

The minister said the government had done its utmost to ensure there would be no tax increases in tomorrow's Budget, in a bid to maintain economic stability.