Labour pledges €1,000 yearly 'super bonus' for all workers

All workers will receive a €1,000 yearly bonus intended to “reward their hard work”, Prime Minister Robert Abela announced on Monday.

Meanwhile, companies with an annual turnover of under €1 million will see their corporate tax rate drop from 35% to 25%, he said.

Speaking at a news conference kicking off the second week of the electoral campaign, Abela and Finance Minister Clyde Caruana announced a series of financial measures to support workers and families.

All workers who have lived in Malta for five years will start receiving an annual €1,000 “super bonus,” in a measure set to cost €200 million.  

The bonus will be given to all workers in the country, including self-employed, part-timers and pensioners who work, Abela said.

Part-time workers with an income under €12,000 will not receive the full €1,000 bonus, but instead receive a pro-rata bonus of at least €500.

The bonus will not be taxed and will be paid directly into people’s bank accounts, Abela said.

Pitching the measure as a reform of the controversial workers’ cheques that characterised recent years, Abela said the measure is intended to reward workers, who he described as “the country’s greatest resource”.

Asked whether the measure could result in a repeat of the criticism faced by the cheque system, which was slammed by international institutions such as OSCE, Abela admitted this could be the case.

“When you implement drastic measures such as this, you might receive criticism,” Abela said. “But these are the fights we are willing to fight because they are the measures by which we improve our families’ wellbeing”.

Meanwhile, companies that have an annual turnover of under €1 million will see their corporate tax rate slashed to 25% from the current 35%.

This measure will impact some 13,000 companies, at a cost of €32 million, Caruana said.

Abela, together with PL MP Ramona Attard, also outlined increases to children’s allowance and in-work benefits, first announced during a campaign rally on Sunday.

A new Labour government would increase children’s allowance by €250 for families with an income of under €40,000, they said.

Meanwhile, in-work benefits, a measure to help parents in employment will rise to a maximum of €250 per child.

The party also plans to introduce changes to the Housing benefit scheme, a system which supports low-income families and individuals access housing.

Under current rules, persons whose income grows to exceed the eligible threshold no longer receive financial support.

This is set to change, with support to be tapered off over a two-year period, Abela said. In the first year after they exceed the threshold, beneficiaries will see their support drop to 50% of the original amount, with this falling to 25% in the second year.