Just days before the presentation of the 2026 Budget, Finance Minister Clyde Caruana has set a clear tone — a Budget that places families and businesses at the centre of Malta’s continued success story.
In his latest announcement, Minister Caruana confirmed that next year’s biggest beneficiaries will once again be Maltese families and enterprises, ensuring that the country’s economic growth translates into tangible benefits for the people.
Despite the global challenges of recent years, Malta continues to perform strongly under the Labour Government’s leadership. The Minister revealed that the national deficit is expected to fall from 3.3% this year to 2.8% next year — a remarkable achievement driven by disciplined financial management and improved tax enforcement.
Even with a €140 million tax cut introduced this year, revenue from income tax has continued to rise — proof that economic expansion and fairness can go hand in hand. This balance reflects the Labour Government’s strategy: reduce burdens, strengthen compliance, and reward those who contribute honestly.
Supporting Pensioners and Protecting the Vulnerable
Minister Caruana announced another increase in pensions that will once again go beyond the COLA adjustment, reaffirming Labour’s long-standing commitment to social justice and respect for older citizens.
While the COLA adjustment is expected to be less than €5, pensioners will still receive a higher increase — an example of how this Government consistently goes above and beyond its legal obligations to ensure dignity for all.
The Minister also confirmed that healthcare will remain Malta’s number one national priority in the coming years. This year alone, around €15 million has been invested to carry out operations in private hospitals, a measure that is already reducing waiting lists and improving access to care.
However, Caruana warned that Malta, like the rest of Europe, faces growing challenges as people live longer and medicine prices rise. “The Health Ministry is the one which absorbs the greatest increase,” he said, adding that annual expenditure in the health sector is now expected to grow by €70–€80 million each year, particularly in oncology and advanced medical treatments.
Responsible Choices, Not Reckless Promises
Minister Caruana also took aim at the Opposition’s so-called “economic proposals”, including their calls for a cut in corporation tax. He made it clear that such ideas are financially irresponsible, pointing out that the Opposition’s proposals would cost around €600 million — a sum that would inevitably require either tax hikes or a ballooning deficit.
“Malta cannot afford populism dressed as economic reform,” the Minister stressed, warning that stability and sustainability must come before empty political slogans.
The same caution applies to large-scale transport projects such as metros or trams. While the Government remains open to exploring modern mobility options, Caruana reminded that responsible governance means careful evaluation, not risky spending for political gain.
Tackling Inflation and Protecting Living Standards
Minister Caruana addressed one of the most pressing global challenges — inflation. He explained that the majority of inflationary pressure is imported and that Malta’s rate remains below the EU average thanks to the Labour Government’s proactive measures.
Beyond the standard cost-of-living mechanism, the Government has introduced an additional €50 million annual compensation fund targeted at low- and middle-income families, ensuring that no one is left behind during times of global uncertainty.
A Budget of Confidence and Continuity
Clyde Caruana’s message is clear: Malta’s finances are in safe hands.
Through prudence, fairness, and innovation, the Labour Government continues to deliver balanced budgets, protect social welfare, and sustain economic growth — all while maintaining one of the lowest unemployment rates in Europe.
As Malta looks ahead to next week’s Budget, one truth stands out — under Labour, economic progress is not an abstract number, but a lived reality for thousands of families, workers, and businesses.
