Budget measures at-a-glance

Resilience 

• Catastrophe Fund repurposed as Resilience and Regeneration Fund from April 1.

• Up to 50 per cent of unclaimed assets (including dormant accounts) redirected to fund climate resilience projects.

• Employee/self-employed contribution rate to Resilience Fund increased from 0.1 per cent to 0.25 per cent.

• Special Needs Grant expanded from March 11, covering blind, deaf, or mute minors retroactively from October 1; further expansion effective June 1.

• Foster care stipend increased to $200 weekly per child from April 1.

• Recruitment of 60 additional Special Constables costing $2M annually.

Growth 

• Removal of duties/VAT on commercial kitchen equipment for registered restaurants/cookshops (April 1–March 31, 2027).

• Extension of hotel food/beverage concessions to qualifying restaurants earning over 60 per cent foreign exchange revenue.

• Reduction of Air Travel and Tourism Development fee for regional passengers from US$35 to US$20 (July 1–June 30, 2026), costing $2.8M.

• Climate-smart agriculture initiatives:

 – Lease-to-own vertical farms and broiler tunnels via BADMC over seven years.

 – Reduced water rates ($1/cubic metre) for registered small farmers.

• Deposit insurance expanded to credit unions; initial funding of $1.75M.

Revenue Efficiency 

• Visitor permits abolished July 1; cost: $355 000.

• Daily car rental levy of $10/day introduced July 1, generating $13M annually.

• Late filing fees eliminated for zero returns from April 1; reduced fees for personal ($100) and corporate ($250) tax returns; penalties capped at 25 per cent of tax payable; five-day payment grace period implemented.

• Annual allocation of $1M for public education on non-communicable diseases.

Cost of Living & Well-being 

• New $5M Podiatry Project targeting improved foot care for citizens over age 70.

• Union membership allowance increased to $360 annually (cost: $600 000).

• Annual meal allowance ($1 500) exempted from income tax (cost: $3.75M).

• Monthly ex-gratia payment ($32) covering minimum water charges for residents in St Lucy/St Peter affected by brown water issues (cost: $2M); Special Task Force established for resolution oversight; waiver extended on tanks/pumps until March 31, 2028.

• Automatic national minimum wage increase of two per cent starting January 1, 2026.

• One-time Solidarity Allowance ($300) payable May by NIS.

• Special Constables with over three years’ service eligible for automatic transition into full Police Service officers from FY2025/26.

• Maternity leave increased to 14 weeks (single births), and up to 17 weeks (multiple births); statutory paternity leave introduced (3 weeks), effective June 1; cohabitation requirement removed.

• VAT cap on fuel remains triggered above US$80/barrel oil price threshold.

• VAT removal effective April 1, on stew beef, minced meats (beef/pork/turkey), pineapples, barley, Vienna sausages, Horlicks malted drink, Saga, lentils; import duty/VAT exemption on pears (not avocados), ortaniques, mandarins, grapefruits and plums.