Tax waivers will be available for people who buy residential properties built more than 20 years ago but have been vacant for seven years as well as properties in Urban Conservation Areas and new properties built in 'typical Maltese' style.
The scheme is capped up to the first €750,000 of the value of the properties, on which no duties or capital gains tax will be charged. Finance Minister Clyde Caruana said in the budget speech that the measure also applies for properties which are still under promise of sale agreements.
First-time buyers of such properties will also receive a grant of €15,000. That grant rises to €30,000 for people who buy such properties in Gozo, with a view of encouraging young people to continue to live in Gozo, the minister said.
The measures come into force from Tuesday and will last for three years.
VAT refund on renovation works
Also from Tuesday, people who renovate such properties will get a refund of VAT up to €54,000 on the first €300,000 spent on renovation works.
While details of the scheme still have to be issued, he said the government is determined to improve the environment, including the village cores.
In order to benefit from the schemes and to avoid speculation, such properties cannot be divided - as is the case when they are split up into a number of apartments.
The minister said that existing schemes for first-time and second-time buyers and those buying a property in Gozo will be extended for another year. The schemes provide for a reduction in stamp duties.
Measures introduced to ease the impact of COVID-19 will end in June 2022, as already announced.
Tax reductions on rented property
The finance minister said the government will halve the tax due on the first €200,000 of the value of properties bought or sold and rented for at least 10 years to tenants eligible for the rent benefit given by the Housing Authority. When the property is sold to the tenant, no tax will be charged.
Tax will also be halved when properties which are rented for more than three years but less than 10 at 'affordable rates' are sold to the tenants.
The minister also announced that the property equity sharing scheme, introduced last year, is being extended and applicable for people aged 30 and over. The scheme sees the government taking a 50% stake in property to enable people to afford their own property.