A new Nationalist government would reduce the income tax bands to a maximum of 10 per cent for all those earning up to €20,000, party leader Simon Busuttil said this morning.
He was addressing a news conference at the Upper Barrakka in Valletta, during which he unveiled a package of tax reduction incentives which, he said, confirmed his party will transform the economy where everyone would benefit.
Dr Busuttil said the income tax measure would see those earning between €9,100 and €20,000 paying just 10% tax. This radical measure would mean that those earning €20,000 would pay just €1,090 in tax instead of the current €2,275.
This measure would benefit 121,000 workers who would see €44 million being left in their pockets. This was social justice in practice, Dr Busuttil said.
He pledged that the Nationalist government would reduce income tax on part-time work to 10 per cent. This would apply for part-time employees and also part-time self-employed, leaving €3.8 million a year in workers’ pockets. A total 5,485 self-employed and 23,000 workers would benefit.
Dr Busuttil said the self-employed and small businesses would also be given an impetus with the reduction of income tax to just 10 per cent on their first €50,000 profit.
This radical measure would apply to all self-employed, whatever the genre of their business. It would generate more economic activity and lead to lower tax evasion.
A new Nationalist government would also completely eliminate the "anti-social" excise tax introduced by Prime Minister Joseph Muscat in the last budget on a number of cosmetics and toiletries.
It would increase the capital of the Malta Development Bank by €360 million for this to guarantee loans of between €25,000 and €250,000 to businesses and new start-ups to encourage them to invest.
It would also reduce the income tax on profits businesses reinvested in their business to 15%.
Innovative businesses would also get full tax exemption, helping create new economic sectors. Tax up to €40,000 a year up to a three -year period would get exempted. This measure, he said, would be linked to partnerships between businesses and educational institutions to strengthen cross fertilisation between education and training.