Abela pledges first-time buyer tax perks for elderly homeowners who downsize

Updated 11pm

Elderly homeowners who sell their home to buy a smaller property will be considered as first-time buyers and benefit from the same tax benefits, if the Labour Party is elected, Robert Abela announced on Thursday. 

Since the beginning of the electoral campaign on April 27, the Labour Party has dedicated a large part of its efforts to proposals for would-be home buyers. And on Thursday evening, Abela turned his attention to elderly homeowners who consider downsizing.

“These people never benefited from any scheme, they had to work hard all their lives. They will now find us by their side," Abela said during an event staged in the format of an "interview" in Mellieħa.

“If given a fresh mandate, these senior citizens will be exempt from paying property tax,  they will be considered just like first-time buyers when it comes to paying property tax,” Abela said.

He said the idea came after visiting an elderly couple who wanted to sell their large home and move to an apartment.

First-time buyers are currently exempt from paying tax on the first €200,000 of a property. In this electoral campaign, the PL has already pledged to increase that tax exemption to €300,000. 

Tax breaks for self-employed

The prime minister also promised that self-employed people will effectively pay less national insurance (NI) contributions. 

Unlike employees - who pay NI at 10 per cent - the self-employed currently pay 15 per cent.

Under the PL’s plan - dubbed “SME boost” - the self-employed will effectively pay 10 per cent as they will benefit from a cash grant. 

“Self-employed will still pay 15 per cent but will be given a cash grant so the amount they pay will effectively be 10 per cent,” Abela said. 

The measure will mean savings for self employed between €630 and €1,450 a year and will cost the government €20 million annually.

Those who immediately become self-employed after their studies will benefit from zero tax on the first €30,000 they earn for three years, he added. 

Abela also said that students who are doing placements as part of their course work will also be receiving a “just pay” for their work. 

Abela made the announcement earlier in the day during a visit to MCAST. He said many young people take on unpaid internships or traineeships during or after their studies. 

Through the proposal, the Labour Party in government will begin a process to ensure that work-based learning is recognised in the country’s labour laws. 

He said the change will mean students and graduates will receive fair payment, the quality of education will be strengthened, and these work experiences will gain formal recognition.

The PL’s candidates contesting the election on the 12th district also attended the event in Mellieħa. Among the crowd there was also former minister and PL parliamentary group member Clayton Bartolo who was greeted by Abela with a hug. 

Bartolo resigned following a months-long saga in late 2024 when his wife Amanda Muscat was given an advisor role first with Bartolo and later with Gozo Minister Clint Camilleri. 

Abela had defended Bartolo for weeks following a damning standards commissioner report. However, revelations of a corruption investigation into the couple over a Malta Tourism Authority deal led to Bartolo resigning as minister and being kicked out of the PL parliamentary group. 

The day before the election was announced, Bartolo said he would not contest the next election. On Thursday evening, Abela saluted Bartolo from the stage.

At the event on Thursday evening Abela said that a new PL government would focus on improving citizens' quality of life, pointing at measures such as the option to ask for flexible working arrangements. 

He said that every proposal the PL has made puts the person at its centre.

"That’s why our slogan is Int Malta (you are Malta)”. 

Abela said that the government can afford all the proposals it is making because it is running a strong economy, adding that only the PL can keep the country’s finances strong enough for these measures. 

'No competence'

The prime minister pointed to the Nationalist Party’s tax plan unveiled on Thursday morning and later described by finance minister and candidate Clyde Caruana as a “total mess”. 

“After hearing the [PN] proposals, I genuinely asked myself if they have any amount of competence when it comes to finance," Abela remarked.

"How can the people trust a party that isn't even able to do a simple costing on a measure?"

He continued that under a PN government, the PN's tax cut measure would "remain a fantasy in the air". 

He said the PN is promising "everything to everyone.... but what they can't promise is credibility and competence and a balanced budget". 

He slammed the costings of the PN's proposal for a "petrol station on Hurd's bank" as "incorrect". 

Abela said the PL is sure that a government under his tenure can deliver on all of its pledges. 

"We are only pledging what we are defintely sure we can implement".