In a recent address on 1st July, Gibraltar's Chief Minister, Fabian Picardo, unveiled the budget measures for the 2024/25 fiscal year. We're sharing key highlights from his annual budget speech, outlining changes in personal and corporate taxation, social insurance, minimum wage, motor vehicle levies, property-related duties, and more.

Personal Taxation

• The maximum effective tax rate will decrease to 25%. Previously, it was 26% for incomes up to £100,000 and 27% for incomes above £100,000.

Social Insurance

• The cap on employers' and employees' social insurance will increase by 5%, making it £53.50 per week for employers and £39.00 per week for employees (subject to confirmation).

Corporate Taxation

• The corporate tax rate will increase from 12.5% to 15%, with the effective date yet to be announced.
• Businesses can get an additional 50% deduction on expenses related to achieving net zero, capped at £10,000 per year, subject to approval.

Minimum Wage

• The minimum wage will rise from £8.60 to £8.90 per hour, with the effective date to be confirmed.

Motor Vehicles

• Import duty will increase to 10% for mild hybrid vehicles and to 5% for full hybrids.

Property-Related

• A special stamp duty of 0.5% will be payable on the assignment of purchase agreements.
• Reduced stamp duty rates for first and second-time homebuyers will only apply to properties costing under £800,000.
• A first-time buyers' allowance equivalent will be introduced for those over 65 selling their home and moving to a smaller property.

Public Sector Fees

• Public sector fees will increase by 2.5%, rounded to the nearest 50 pence.

Economic Data

Tax Receipts for 2023/24

• Personal taxes: £255.5m (+3.1%)
• Corporate tax: £155.3m (-2.3%)
• Import duty: £94.9m (+2.1%)

Gross Domestic Product

• 2023/24 preliminary forecast: £2.91bn
• 2022/23 preliminary estimate: £2.75bn (+5.8%)

Employment Data

• Total number in employment in October 2023: 31,523 (+1.2% from October 2022)
• Average earnings in October 2023: £36,050 (+5.7% from October 2022)

Unemployment

• Average registered unemployment in 2023: 27 persons

Percentages indicate the change from the previous year's reported figures.

Please note that the information provided in this article is sourced from the Chief Minister of Gibraltar, Fabian Picardo's annual budget address delivered on 1st July. This summary is for informational purposes only and should not be considered as financial, legal, or professional advice. For personalised advice, please consult a qualified professional.