The Minister for Finance, Clyde Caruana, will present Budget 2027 on Monday 26 October 2026. It is the first budget of the current legislature following the general election, and it follows a pre-budget period in which the Government has signalled continuity on headline tax rates and a continued commitment to energy support. This article sets out what the pre-budget material indicates, the baseline established by Budget 2026, and the matters likely to be of most interest to internationally active businesses once the speech has been delivered.
Key takeaways
- Budget 2027 will be presented by the Minister for Finance, Clyde Caruana, on Monday 26 October 2026.
- Pre-budget statements indicate unchanged VAT and social security contributions, maintained energy subsidies and a further income tax reduction for parents from 1 January. None of these is confirmed until the speech is delivered.
- Budget measures take legal effect through later legislation. The Budget 2026 measures were announced in October 2025 and gazetted on 10 March 2026.
- Applies to: businesses and groups with Maltese operations, together with their owners and finance teams.
What the pre-budget material indicates for Budget 2027
The Pre-Budget Consultation Document for 2027, published on 30 September 2026, draws on European Commission forecasts of 3.7% real GDP growth in 2026 and 3.6% in 2027. Malta’s deficit stood at 2.2% of GDP in 2025, with the Commission forecasting 2.2% in 2026 and 2.1% in 2027, both below the 3% reference value under the EU fiscal rules. The document also records that gaming accounted for 37.9% of exports in 2025, which underlines the continuing weight of a small number of service sectors in the external economy.
Public statements since the consultation document point in a consistent direction. The Prime Minister has confirmed that energy and fuel subsidies will be maintained at their current level, and has described the Budget as expansionary while acknowledging that international conditions are not expected to improve in the near term. Income tax is scheduled to fall again for parents from 1 January, which forms part of an existing multi-year reform rather than a new proposal. VAT and social security contributions are reported to remain unchanged, and manifesto commitments are to be phased over five years according to priority.
| Area | Indication to date | Nature of the source |
| Energy subsidies | To be maintained at current levels; fuel prices not to be raised | Prime Minister’s statement |
| Personal income tax | Further reduction for parents from 1 January, as part of an existing phased reform | Prime Minister’s statement; pre-budget document |
| VAT | No change indicated | Prime Minister’s statement |
| Social security contributions | No change indicated | Prime Minister’s statement |
| Manifesto measures | Phased over five years | Prime Minister’s statement |
Budget 2026 measures still being implemented
Budget 2027 will be read against measures that remain in the process of implementation. The Budget 2026 speech was delivered in October 2025, whereas the Budget Measures Implementation Act, 2026 was gazetted on 10 March 2026, with most measures taking effect from 1 January 2026. Among them are a deduction of 175% for qualifying research, development and innovation expenditure and a revision of personal income tax bands and rates, which the Government has indicated will be introduced over three consecutive years from basis year 2026.
The interval between announcement and enactment is relevant in practice. A measure announced on Budget night may apply to income earned in the following year, may be assessed in a later year of assessment, or may depend on rules that are issued only after the speech. The announcement date, the legislative date and the commencement date therefore require separate verification for each measure.
Business community submissions
The Malta Chamber of Commerce, Enterprise and Industry presented its pre-budget document, titled RESET and LEAD, containing more than 150 proposals. Its central themes are a shift from volume-driven growth to value-added activity and a more efficient work permit system that enables businesses to make fuller use of workers already in Malta. These are proposals of a representative body and do not represent Government policy; the extent to which any of them is adopted will become apparent only on 26 October.
What Budget 2027 may mean for businesses with Maltese operations
Where headline rates are expected to remain stable, attention shifts to targeted measures and to implementation. For cross-border groups with Maltese operations, the relevant items are likely to include any refinement of the innovation and digitalisation incentives introduced under Budget 2026, measures affecting compliance and enforcement, and any change to the treatment of sectors with a high export contribution. The timing of legislation will matter as much as the content, since groups with 31 December year-ends will need to establish which measures apply to the 2026 and 2027 basis years respectively.
CLA Malta will provide live updates on its social media channels throughout the Budget speech on 26 October 2026, and will publish a full analysis of the measures announced once the speech has been delivered and the accompanying documents are available.
How CLA Malta can assist
Businesses should assess announced measures against their own structures at an early stage, since commencement dates and eligibility conditions often differ from the headline announcement. CLA Malta’s Tax team can assist with analysing the measures once they are published, and its Advisory team, through the Funding and Incentives service, can assist with identifying incentives relevant to a particular business. Contact CLA Malta to discuss how the Budget 2027 measures may apply to a specific organisation.
Frequently asked questions
When will Malta’s Budget 2027 be presented?
Budget 2027 will be presented on Monday 26 October 2026 by the Minister for Finance, Clyde Caruana.
Will VAT or income tax change in Budget 2027?
Pre-budget statements indicate that VAT and social security contributions will remain unchanged, and that income tax will fall again for parents from 1 January as part of an existing phased reform. These indications are not confirmed until the Budget speech.
What is the difference between the Budget speech and the Budget Measures Implementation Act?
The speech announces measures. The Budget Measures Implementation Act gives them legal effect and sets their commencement dates. The Budget 2026 speech was delivered in October 2025, and the corresponding Act was gazetted on 10 March 2026.
How should businesses prepare for a Malta budget?
Generally, businesses review the measures announced against their own structures, identify the commencement date of each measure and establish whether it affects the current or a later basis year. Professional advice should be obtained for the facts of a specific case.