These are the Malta Developers Association’s (MDA) proposals presented to Government for Budget 2014:
- A one-time concession be given for the year 2014 to those who do not own any property and are buying a property for the first time in their lives so that they will not pay stamp duty.
- Substantial incentives to encourage the regeneration of our village cores (UCAs), which are being neglected at an alarming rate and there is a huge lack of interests among developers to invest in these localities:
- a substantial reduction in the MEPA tariffs so that houses and properties in these old areas are renovated, even when this involves demolition;
- removal of Capital Gains Tax on the transfer of property in these localities and a tax of 15% on profits will be paid only after the relevant fiscal receipts are presented which show that VAT has been paid; and
- all the village cores should be given fiscal incentives as Special Designated Areas.
- Incentives for development of new buildings that exceed the EU’s energy-saving objectives, as well as those that upgrade existing buildings.
- The system of 15% withholding on residential rents should be introduced with the option of paying the normal tax rate on income.
- For tax purposes, the Inland Revenue Department should accept the valuation that any architect gives to a property so long as that architect is responsible for the valuation he/she gives. This is a temporary measure until the property price index, which is being discussed in the BICC, is established.
- Since many neglected properties or undeveloped sites have ground rents imposed on them and in the majority of them the Direct Dominium is owned by the government itself, a scheme should be issued so that these government ground rents are converted to a freehold property. In this way one puts one’s mind at rest if one invests in these sites. Whoever is given this concession would be bound to make a substantial investment in the site within five years.
- The full process should start for all properties to be registered with the Land Registry so that the bureaucracy of research will be minimised and every buyer can put his/her mind at rest on the title of the property he/she is buying.
- Where Capital Gains Tax has been paid at a rate of 12% on the value of the sale, a refund on that part of the tax that would have been paid on VAT would be given.
- All of Gozo should be considered a special designated area.
- The sale of property to foreigners should be encouraged. Schemes like the Malta Retirement Programme will be set up or updated to promote these property sales. A Marketing Incentive Scheme will be set up to assist developers to undertake marketing campaigns abroad for the sale of property.
The MDA feels that with all these measures there will be a positive impact and fresh investment will be attracted to property.