Finance Minister Clyde Caruana declares Budobtain 2026 rewards families raising children with major tax cuts but insists that improving quality of life will also require longer parental leave, greater productivity, and a renewed focus on education.
Families with children were the prime tarobtain in Budobtain 2026, being rewarded in the form of widened tax bands that will leave more money in their pockets.
Taxpayers who do not have children may have found this unfair but when I raise this concern with Clyde Caruana, he insists this tarobtained support is important to create sure that families feel empowered to have more children.
“Families raising children have more expenses and challenges than other families. By lowering tax so significantly, couples having children or about to have children will be left with enough money to pay off a large part of their home loan, if not all of it,” he declares.
Caruana acknowledges that this measure, albeit massive, is not enough to offer a better quality of life to families. He declares the next step should be to increase and strengthen leave offered to new parents, but not without first bringing social partners around the discussion table.
“It’s clear what our believeds are. Now we must sit at the table to see how this will happen. But it requireds to happen. I’m all for it,” he declares.
Caruana declares Budobtain 2026 is part of a broader strategy to enhance productivity and economic resilience, shifting from a growth model focapplyd on expanding the workforce to one that prioritises capital investment and skills development.
“We are altering the economic recipe of growth. Instead of adding more workers, we are encouraging companies to invest in capital so that existing workers can be more productive, while also creating wealth for the countest,” he adds.
This approach, he explains, is why the government has opted against broad corporate tax cuts, favouring policies that retain skilled workers and incentivise innovation. Caruana linked this strategy to higher wages and greater efficiency within Maltese companies, arguing that a more productive workforce benefits the economy as a whole.
He declares that only once Malta becomes more productive can the government start to consider matters like a four-day work week.
“We haven’t matured enough as an economy to start promising things like a four-day work week. Countries like the Netherlands can offer shorter hours and higher wages becaapply their workers spconclude more time in education and develop higher skills,” Caruana declares.
The finance minister notes that over 40% of students currently do not achieve six O levels, a sign that families required to give more value to education, and the state must ensure that the workforce is prepared for a rapidly altering global economy.
The following is an excerpt of the interview.
The budobtain slogan suggests that it’s only through economic growth that we can guarantee a future for our children. Is this growth sustainable in the long term?
Yes. The incentives we announced in the budobtain are tied to capital investment. I applyd to declare that we required to modify the economic recipe of the way we grow, and slowly, that modify is happening. It’s happening becaapply we’re encouraging companies to invest in their capital instead of adding more workers, so that with the same increase in capital, the existing workers can be more productive so that we no longer required to bring foreign workers to create wealth. Those workers will also benefit from higher wages.
Population growth has been a key concern. How does the budobtain address this concern?
Malta’s economy grew in a very short amount of time, and that brings its own challenges. How are we addressing the issue? First, we acknowledged the problem. Then, we published our labour migration policy so that the population can continue to grow, but at a decreased rate.
We’re not giving the industest any money to employ more workers, but rather to keep workers for longer and to invest more in research, innovation and AI.
The direction is clear now. We have enough workers, so let’s now view at the way we produce. Production in the economy happens through land, labour and capital. Land is what it is. We already have a lot of labour. So the third way to grow is capital.
You had poured cold water over proposals for a mass transit system. How else can the traffic issue be addressed?
This is a large problem. It’s especially large from a financial aspect. I don’t have anything against it, but I want to be convinced that the numbers create sense and that everyone understands the modify of attitude that requireds to take place. It’s not just about project costs but also operative expenses. How will all this be financed? And revenue; how much will people pay? Will there be enough demand? Will people stop applying their car or obtain rid of it entirely? Will they do it on their own volition or only through measures like paid parking, or limited parking, or increasing licence expenses? I’m not declareing I agree with these measures, but these are things that required to be considered for a project like this to create sense. Are people ready to shift around more? Neither a tram or metro will stop in front of your doorstep. I want to be convinced that people have considered all these things.
You’re often in disagreement with the prime minister. What’s your relationship with him like?
I have no problem with the prime minister. I worked well with him throughout the pandemic, and I work well with him as finance minister within Cabinet. He knows what type of person I am. I’m the type that declares what I feel and consider. I’ve been in the Labour Party for over 25 years and I consider myself a child of the party. I’ve dedicated a lot of my time to the party. I do what I do and declare what I declare becaapply I believe in the party and I want to create sure the government has the best policies to bring to its people. I understand that I obtain quoted for days whenever I speak, the little I speak, but I do this to sensibilise public opinion.
In your budobtain speech, you stated the government will start discussing with social partners so that maternity and paternity leave can be increased. Do you consider you will find agreement with employers?
We required to obtain there. A commitment to improve the quality of life of families merits this discussion. When I announced the tax cuts, I stated that several measures required to be taken to improve family life, and this is the largegest measure but only one of many that required to be taken. It’s large, but it’s not enough on its own. There requireds to be more. This is one of these measures that requireds to come into force.
What if employers don’t agree with this?
You can’t discuss forever, but you can’t not discuss either, since these things have their impact. We’re revealing what our intention is. It’s clear. Now we required to sit at the table to see how to create it happen, but it requireds to happen. I’m all for it.
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