Act III of 2026 is the Budget Measures Implementation Act for the financial year 2026. Its Preliminary Part (Articles 2–5, deemed in force from 1 January 2026) authorises the Government of Malta to raise a loan not exceeding €1,900,000,000 under the Government Borrowing and Management of Public Debt Act (Cap. 575), to be applied to cover excess expenditure on the Consolidated Fund, redeem stocks and debt instruments, contribute to sinking funds, and manage Treasury Bill and Government Stock portfolios.

Part II (Articles 6–7) amends the Civil Code (Cap. 16) by inserting new Article 1178A, which provides a mechanism for a debtor to deposit in court a judgment sum owed to multiple creditors where the creditors fail, within three months of judgment, to give joint written instructions by judicial letter on how to divide the sum. The deposit exempts the debtor from further interest from the deposit date. The lodgement schedule is filed in the First Hall Civil Court or Court of Magistrates depending on the amount. Publication in the Government Gazette and two daily newspapers (one Maltese, one English) suffices for service. A creditor may at any time withdraw his own share without the others' consent. The article applies retroactively to judgments already delivered, with the three-month period running from the day after commencement.

Part III (Articles 8–12) amends the Customs Ordinance (Cap. 37). Article 9 inserts new sub-articles (3) and (4) into Article 70C, requiring persons to supply information to the Commissioner on request and making failure or the provision of false information an offence punishable by a fine of €250–€2,500 (one-third treated as a civil debt) and/or up to three years' imprisonment, with a mandatory court order to supply the information. Article 10 substitutes Article 72 with a detailed procedure for withheld goods: a 90-working-day decision window; issuance of a seizure note; ipso jure forfeiture if not contested within 30 days; contestation before the Administrative Review Tribunal; and special provisions for perishable or high-value goods. Article 11 substitutes Article 73, creating a structured ART appeal procedure for seizure cases with strict timelines (first hearing within 30 days, Commissioner reply within 20 days). Article 12 inserts new Article 93, extending to the Commissioner, customs officials and police officers the liability protection afforded by the Holders of Public Office and Public Entities (Responsibility) Act (Cap. 652).

Part IV (Articles 13–19) amends the Income Tax Act (Cap. 123). Article 14 (applicable from year of assessment 2026) adds Special Limited Partnership Funds to the definition of 'company'. Articles 15–19 (applicable from year of assessment 2027): Article 15 corrects cross-references in Article 12(1)(c)(iii)(C)(b). Article 16 inserts new paragraph (ha) into Article 14(1), introducing a 175% enhanced deduction for research, development and innovation expenditure, with capital expenditure spread over six years; commencement is by Ministerial notice in the Gazette and the Minister may prescribe qualifying activities by rules. Article 17 raises the deduction ceiling in Article 14D(b) from €2,500 to €4,500. Article 18 corrects a cross-reference in Article 49A(5)(b). Article 19 substitutes the tax rate tables in Article 56, restructuring income tax bands for married couples (paragraph (a), with sub-paragraphs for couples with one qualifying child and with two or more qualifying children) and for other individuals (paragraph (b), with sub-paragraphs for parents with one child, single parents with sole custody, parents with one child qualifying for the 'parent rates', and parents with two or more qualifying children); the 35% top rate threshold remains at €60,000 across all categories. Article 19 also widens the definitions of 'licensed coach' and 'registered player or athlete' in Article 56(26) to include clubs or teams 'recognised by' (not only 'registered with') the Council.

Part V (Articles 20–32) amends the Social Security Act (Cap. 318). Articles 21, 28 and 29 replace 'Commissioner for Inland Revenue' with 'Commissioner for Tax and Customs' throughout Articles 2, 116B and 132. Article 22 updates the reference from 'Department of Inland Revenue' to 'Malta Tax and Customs Administration' in Article 11. Article 23 inserts new Article 23(7): from 1 January 2026, persons aged 65 or over receiving Supplementary Allowance under Article 73 are entitled to Free Medical Aid without a means test. Article 24 amends Article 26(1)(d): a new proviso (effective 3 January 2026) grants persons awarded the highest impairment rating under the Impairment Tables Regulations a two-thirds pension rate if more advantageous; a further new proviso (effective 1 January 2026) entitles persons certified by a consultant psychiatrist as suffering from bipolar condition, depression by psychosis or acute depression, with at least three years of regular treatment and a psychiatric evaluation within the preceding three months, to the full Invalidity Pension rate and allows part-time insurable employment. Article 25 amends Article 31(b) to extend the child-related widow/widower pension supplement to children up to age 23 (previously unclear from text). Article 26 inserts a proviso in Article 85(9) creating a one-time child birth/adoption bonus (effective 1 January 2026): €1,000 for the first child, €1,500 for the second, and €2,000 for each subsequent child, payable upon registration at the Public Registry. Article 27 amends Article 116: interest replaces 'further contributions' for late contributions from 1 January 2026; persons born on or after 1 January 1962 pay interest on payable contributions; early pension option extended to persons aged 59 receiving Invalidity Pension, Carers Allowance/Grant, or persons aged 59–64 not in insurable employment who would thereby achieve a minimum of ten years' contributions. Article 30 extends to persons born on or after 1 January 1962 the provisions previously limited in Eleventh Schedule item 2(d) and (e). Article 31 sets the maximum pensionable income for persons born on or before 31 December 1961 at €25,500 from 1 January 2026. Article 32 substitutes the Fifteenth Schedule with revised disability assistance qualifying percentages: Disability Benefit 30–44.99%, Disability Assistance 45–59.99%, Severe Disability Assistance 60–74.99%, Increased Severe Disability Assistance 75%+, Assistance for Visually Impaired 50%+.

Part VI (Articles 33–38, deemed in force from 1 January 2026) amends the Motor Vehicles Registration and Licensing Act (Cap. 368). Article 34 substitutes Article 8(4) to restrict high-emission M1 vehicles (≥200g CO₂/km NEDC or ≥220g WLTP) and motorcycles (≥801cc) to road use only on Friday evenings from 18:00, Saturdays, Sundays, national and public holidays. Article 35 substitutes Article 21(4) reducing the vehicle registration deadline to 30 days from arrival and adds new sub-articles imposing a €30/day administrative penalty for unjustified delay beyond that period, with specific timelines for appeal and exemption scenarios; the penalty does not apply to agricultural tractors or Category F vehicles. Articles 36–38 amend the First, Second and Fourth Schedules to update category headings (adding Category G for mobile cranes exceeding 50 tonnes at 0% registration tax), revise motorcycle registration taxes, and update annual circulation licence fee tables including new entries for caravans and motor homes.

Part VII (Articles 39–42) amends the Income Tax Management Act (Cap. 372). Article 40 substitutes Article 28(1) to modernise signature requirements, permitting electronic notices via web portal or the Commissioner's electronic address without a handwritten signature. Article 41 substitutes Article 29(1) to modernise service of notices, permitting electronic service via email or web portal and providing a deemed-service mechanism by Gazette/newspaper publication where a person cannot be found. Article 42 extends the time limit in Article 31(2A) for the Commissioner to raise an assessment from five years to ten years.

Part VIII (Articles 43–54, in force from 1 April 2026) amends the Excise Duty Act (Cap. 382). Article 44 makes general terminological substitutions replacing 'band or stamp' with 'excise stamp' throughout. Article 45 amends Article 2 definitions, adding 'certified consignee', 'certified consignor', 'nicotine pouch' (HS Code 2404919000) and 'smokeless tobacco product', redefining 'release for consumption' and 'authorised tax warehouse'. Article 46 inserts Article 3(5), exempting from excise duty non-harmonised excisable goods in consignments with intrinsic value not exceeding €150, imported by post or authorised courier for private use by natural persons meeting specified conditions; the Minister may make further regulations. Article 47 deletes Article 4(4). Article 48 amends Article 16A, reducing the administrative penalty for the Article 16(1)(v) irregularity to €200 and adding provisions that signing a settlement agreement constitutes a waiver of claims against the Commissioner, State Advocate or Attorney General, and applying the Customs Ordinance's €150 threshold provision where total duty is below €150. Article 49 amends the Second Schedule, replacing separate rates for ethyl alcohol and spirit-based flavoured beverages with a single rate of €0.136 per % vol. per litre for ethyl alcohol. Article 50 substitutes item 2 of the Third Schedule on the ad valorem duty retail price for cigarettes. Article 51 adds fuel oil (HS Code 27101962, density 0.8200–0.8900) to the Fourth Schedule as gas oil at €330 per 1,000 litres. Article 52 makes extensive amendments to the Sixth Schedule (Parts A, B, C and D), updating excise stamp purchase and affixing deadlines to five working days, harmonising penalties (fines of €100–€300 on conviction, with administrative compromise penalties of €100–€250), creating new regulations 13A and 13B for release of excisable goods, substituting regulation 16 to require monthly statements within 15 days and payment within 15 days of submission with administrative penalties of €100/month for late submission/payment (up to three months), updating tobacco Track and Trace obligations, and making corresponding changes to petroleum oil statement requirements in Part D.

Part IX (Articles 55–74) amends the Value Added Tax Act (Cap. 406); Part X (Articles 75–79) amends the Eco-Contribution Act (Cap. 473); and Part XI (Articles 80–83) amends subsidiary legislation — however the full text of these Parts was not included in the text provided, so their content is unclear from text.

Commencement: Part I is deemed in force from 1 January 2026 (Article 2); Part VI is deemed in force from 1 January 2026 (Article 33(2)); Part VIII comes into force on 1 April 2026 (Article 43(2)); Income Tax Act amendment in Article 14 applies from year of assessment 2026, Articles 15–19 from year of assessment 2027 (Article 13(2)); various Social Security provisions specify effective dates of 1 January 2026 or 3 January 2026 within the articles themselves; the 175% R&D deduction (Article 16) commences on a date to be set by Ministerial notice. The remainder of the Act appears to come into force on the date of publication (10 March 2026) or assent, though this is unclear from the text for Parts IX–XI.

Budget Measures Implementation Act, 2026 (Act III of 2026)