The European Union has formally launched excessive deficit procedures against Malta and six other countries.

EU rules dictate that a country’s deficit should not exceed 3% of its gross domestic product.

Malta’s deficit stood at 4.9% in 2023, which is just under €1 billion.

Belgium, France, Italy, Hungary, Poland and Slovakia are also facing excessive deficit procedures.

The Maltese government has repeatedly defended its position, arguing that the deficit is falling as the economy grows. 

According to the European Commission, Malta’s deficit could not be put down to any unusual event nor due to a severe economic downturn.

The excessive deficit rules were temporarily suspended during the COVID-19 crisis but have since been brought back into force.

In June, the commission again urged Malta to wind down the emergency energy support measures by this winter and address remaining aggressive tax planning risks. 

Prime Minister Robert Abela had warned ahead of the EU elections earlier this month that Malta would not lift the energy subsidies