clyde caruana budget 2022

Minister for Finance Clyde Caruana has unveiled more details about the Labour Party’s pledge to lower the corporate tax rate from 35 to 25 per cent, clarifying that this only applies to profits remaining within the company.

Speaking at a press conference on Friday, Minister Caruana explained that dividends paid out to shareholders will continue to be taxed in line with existing tax structures.

“If those profits are absorbed by the individuals, the current tax rates apply,” he said.

The Minister also clarified that the reduced tax rate would only apply to the first €250,000 of profits generated by the company.

The reduction in the corporate tax rate is the PL’s flagship business proposal, announced on the first day of the electoral campaign.

Commenting on the war in Ukraine, Minister Caruana said that a Labour Government would not raise any taxes during the conflict, exressing his concern that it would make Malta less competitive in the global market.

On the other hand, “if we prepare for this impact, our country will be more competitive, he said.

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