The government yesterday presented its Budget for 2010 aimed at boosting economic growth and job creation through support for industry and small enterprises.
The measures announced included help for small enterprises and the self-employed such as the allocation of €10 million in EU funds for microfinance and a 40 per cent tax credit for SMEs (60 per cent if based in Gozo) that employ up to 10 employees if they invest in new technology or generate new jobs.
An additional €8.5 million in EU funds for industry, the creation of a reserve fund of €2.5 million as assistance to industry, an upgrading investment of €16 million for industrial zones, increased funding for Malta Enterprise, more money for research and innovation and an investment of €20 million for a Biotechnology Park in San Ġwann were also announced by the government.
Finance Minister Tonio Fenech said the government was projecting a deficit of 3.8 per cent of GDP for this year and a 3.9 per cent deficit for 2010, meaning it will not comply with the European Commission's demand to bring the deficit down to the Maastricht criteria of three per cent threshold by the end of 2010.
He said the projected GDP growth for 2009 was -2 per cent and one per cent for 2010.
A cost-of-living increase of €5.82 per week was announced by the government, which also decided to remove the €16.31 levy on credit cards and increase excise duty on cigarettes.
The Malta Tourism Authority will be allocated €31 million, including a special package of €5 million to address the international crisis. However, the government is unlikely to cut the 18 per cent VAT rate on restaurants after a Ministry of Finance report concluded that such a decrease would only contribute towards a 0.2 per cent growth rate in 2010 and the Treasury would lose €29 million.
Various programmes are being introduced to help people return to work including assistance to mothers for childcare facilities and help for unemployed youths aged 16-20.
The government announced an allocation of €10 million to compensate for the increase in the price of energy from next year. Ninety-seven per cent of families will benefit.
A sum of €25 million has been allocated for the Eco Gozo project over a three-year period, €400 million earmarked for capital projects and €80 million for the embellishment of attractive zones.