Malta will push ahead with a three-year program of income-tax cuts even as the government seeks ways to bring its budget deficit below a European Union limit, Finance Minister Edward Scicluna said.
The Mediterranean island nation’s 2012 budget shortfall was equivalent to 3.3 percent of gross domestic product, exceeding the EU’s 3 percent target. Scicluna told lawmakers in the capital, Valletta, last night that the government would trim the deficit to 2.7 percent of GDP this year.
Scicluna, in his post for a month, said he’ll stick to plans announced by the previous government to reduce the top income-tax rate by 10 percentage points to 25 percent in three years.
“We will keep the proposed tax cuts,” Scicluna said today in televised remarks, reiterating comments made by Prime Minister Joseph Muscat on April 5. “We are committed to growth and we will implement the program.”
The European Commission forecasts the Maltese economy will expand 1.5 percent this year and 2 percent in 2014.
The finance chief also said spending reviews will be conducted for all government ministries.