Premier and Minister of Finance, Reuben T. Meade, has unveiled a comprehensive package of fiscal relief measures aimed at reducing living costs, boosting economic activity, and supporting working families, during the presentation of the 2025/26 Budget in the Legislative Assembly on Tuesday.
“To meet the challenges and address some of these issues, this Government will seek to implement targeted fiscal relief initiatives designed to ease financial burdens on our people while fostering economic growth,” Premier Meade stated.
Key areas of focus include Construction Support, Import Tax Relief, and the reintroduction of a Tax-Free Child Allowance.
“Firstly, we will seek lower tariff rates on all basic building materials and streamline existing concessionary programmes to reduce the administrative burden and maximise take-up by residents,” he said.
“Consequently, I am pleased to announce the proposed standardisation of import taxes for all basic building materials as follows: 5% Customs Duties and 10% Consumption Tax.”
These reduced rates will be automatically applied.
“Once implemented, there is no need for any application to benefit from these reduced rates. Items imported from a CARICOM Country with the required ‘Certificate of Origin’ will only pay the Consumption Tax of 10%.”
To help all consumers and businesses, government plans to revise how import taxes are calculated.
“We will seek to reduce the amount paid for import taxes on all imports. This will be achieved through the potential reduction of the freight element of the Cost, Insurance, Freight (CIF) calculation by 50%, reducing the amount paid for Customs Duties and Consumption Tax on all imports. This change will benefit all persons in Montserrat.”
In a move to support working parents, a new tax allowance is being proposed.
“We will seek to enshrine an additional ‘Child Allowance’ of $1,500 per child for up to three children (up to the age of 18 years old), which only one parent can claim.”
Changes are also coming to how overtime income is taxed.
“In order not to punish workers who go beyond the call of regular duty and work overtime, their tax for overtime income will now be at the tax rate which they are taxed on their regular salary,” the Premier said. “To clarify, Madam Speaker, as existed previously, all overtime income was taxed at 30%. Going forward, if a worker is normally taxed at a rate of 10%, their overtime will now be taxed at 10% and so on. That means productive, hardworking members of the community will have more money in their pockets.”
Support for agriculture remains a major priority.
“It is our goal to double our agricultural output in selected crops, livestock and fisheries,” Meade announced. “$1 million in very low interest loans [will be] available to our farmers for agricultural development to supplement the Ministry of Agriculture’s efforts… This is part of a revolving fund to be replenished via repayments each year. This is not a one-off gesture but a commitment to our local farmers and fisherfolk.”
For small businesses, new opportunities are being created through access to finance.
“In order to develop the micro enterprise sector, we are providing $1 million to fund low interest loans of up to a maximum of $50,000 per loan. This will be a revolving fund to be replenished by repayments each year. Again, Madam Speaker, not just a one-off gesture but a multi-year commitment by this government.”
On housing, the premier noted its central role in supporting growth and improving quality of life.
“Housing for our current, returning and new residents is a critical enabler to ensuring quality of life and growth in residential numbers,” he said. “Over the course of this year, your Government will prioritise funding to continue to expand housing incentives programmes, land and infrastructure development that will unlock public-private investment housing, boost the construction sector and to ensure quality housing for our people.”
Efforts will include the introduction of innovative solutions.
“We will also be introducing new low-cost housing systems to ensure that our lower income earners can afford to own a house. Training in the use of this new technology will commence early in this budget cycle. We have allocated $500,000 to start this initiative.”
In addition, a new fund will address housing repairs for properties in disrepair.
“Many houses which we have visited during our election campaign and some that have been abandoned require modest sums to get them up to a suitable standard. We have allocated approximately $900,000 this year to support this initiative.”
Government also plans to improve access to housing programmes with a digital upgrade.
“We will also be modernising our Housing Information Management system, to enable digital routes for housing assistance applications, data management and analytics to inform policy interventions.”
The fiscal relief package, Meade said, demonstrates a long-term commitment to economic development and the wellbeing of all Montserratians.
Read the full Budget presentation here –>2025-26-Budget-Speech-FINAL
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