5% Tax Relief For Self-Employed Workers Under SMEBoost Scheme

Prime Minister Robert Abela has unveiled a new proposal aimed at reducing the tax burden on self-employed workers through a scheme known as SMEBoost.

Speaking about the measure, Abela highlighted the disparity between the contributions paid by employees and those paid by self-employed individuals. While employees contribute at a rate of 10% because part of the burden is shared by their employer, self-employed workers currently pay 15% as they must carry the full cost themselves.

Abela said the time has come to offer stronger support to the self-employed sector, describing them as a vital part of the Maltese economy.

Under the proposed SMEBoost scheme, self-employed workers would continue paying the existing 15% contribution rate, but would receive a cash grant that effectively reduces their burden to the equivalent of 10%. The grant would amount to 5% of their declared income.

According to the Prime Minister, the measure would translate into annual savings of between nearly €630 and €1,450 at current rates. Over the next legislature, self-employed workers could save as much as €7,150.

The government estimates that the proposal would inject more than €20 million annually into the self-employed sector, amounting to over €100 million over five years.

Abela also stressed that, despite the reduction in the effective contribution burden, self-employed workers would continue to receive the same pension entitlements as before.

“We always give without taking anything back,” he said, insisting that the proposal is designed to strengthen support for independent workers while safeguarding their future benefits.