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what is tax in Malta, and is it considered a tax haven ?

No, really... it does!
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what is tax in Malta, and is it considered a tax haven ?

Postby londonphoto » Thu 9 Apr 2009 19:55 GMT

Hello !

what is the standard level of taxation for Maltese citizen (citizens, not residents), ?...is it the same as permanent residents (15% on the total of the earning brought in Malta) or it mirrors the calculations that apply to ordinary residents?

..does anyone has got any ideas were Malta will stands after the new agreement of the G20 on fighting tax havens?.. does anyone think will affect Malta tax benefits on permanent and ordinary residents ..or not at all?

thanks for your help !
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Postby gozomark » Thu 9 Apr 2009 20:40 GMT

what is the standard level of taxation for Maltese citizen (citizens, not residents), ?...is it the same as permanent residents (15% on the total of the earning brought in Malta) or it mirrors the calculations that apply to ordinary residents the latter

income tax tables
http://www.britishexpat.com/expatforum/ ... hp?t=20622


..does anyone has got any ideas were Malta will stands after the new agreement of the G20 on fighting tax havens
Malta isn't considered a tax haven by OECD

http://www.independent.com.mt/news.asp?newsitemid=85882

OECD reconfirms Malta not a tax haven
by DAVID LINDSAY


As G20 leaders convened this week to address the economic crisis, and with the issue of tax havens high on their agenda, the Organisation for Economic Cooperation and Development reconfirmed that Malta is on its white list of States implementing the internationally agreed tax standard.

The reconfirmation comes despite the country having been labelled as a tax haven and included on a black list forming part of the proposed Stop Tax Haven Abuse Act before the United States Congress.

The act, co-sponsored by then senator and now President Barack Obama, lists Malta as one of 34 countries on its initial list of “offshore secrecy jurisdictions”.

Describing the countries, including Malta, on the proposed law’s black list, fellow co-sponsor Senator Carl Levine is quoted as having said, “They peddle secrecy in the way other countries advertise high quality services. That secrecy is used to cloak tax evasion and other misconduct.”

A number of international news reports in the lead up to the G20 also referred to Malta as a tax haven, despite the country having avoided the OECD’s black list back in 2000 after it pledged to meet international norms by 2005. And nothing, according to the OECD, has changed since then.

According to its progress report on jurisdictions surveyed by the OECD published on Friday, Malta is on the white list of “jurisdictions that have substantially implemented the internationally agreed tax standard”.

Austria, Belgium and Luxemburg are the only EU states included on the grey list of countries committed to the standard but which have not yet satisfactorily implemented it.

The only jurisdictions on the OECD’s black list that face the threat of OECD sanctions are Costa Rica, the Philippines, Uruguay and the Malaysian territory of Labuan.

The internationally agreed tax standard requires the exchange of information on tax matters for the administration and enforcement of domestic law.

While providing extensive safeguards to protect the confidentiality of the information exchanged, it supersedes any domestic bank secrecy mechanisms for tax purposes only.

It was endorsed by G20 finance ministers in 2004, as well as by the UN Committee of Experts on International Cooperation in Tax Matters in 2008.
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permanent resident

Postby londonphoto » Fri 10 Apr 2009 09:59 GMT

Thank you very much Mark for your reply !
Any idea if Malta will be ultimately forced to scrap the PERMANENT RESIDENCY status as a result of the cooperation with the OECD?
I have the impression this might happen soon !
Any article or political declaration in regard of this issue?

thanks !
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Postby gozomark » Fri 10 Apr 2009 10:24 GMT

no idea TBH - there are various reasons why could be scrapped at some point

1. internal pressure - if Labour won general election, would they scrap it ?
2. EU pressure - at moment each country has its own taxation system
3. OECD pressure

very few foreigners in Malta use PR - Id guess alot less than 10%, esp amongst EU citizens - so i maybe not that big a deal

I have the impression this might happen soon ! what gives you that impression ? not saying you are wrong, just wondering whethr an official said something to you, or you read something
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just 10% !!!

Postby londonphoto » Fri 10 Apr 2009 10:59 GMT

Just 10% of the foreigners are PR !!.. I thought much more ! the scheme of a flat fee of 15% is very attractive.. if you are a self employed working mainly overseas ! (I am photographer). And I thought the PR benefits and status is important to Malta to attract capitals !
SO Mark, if I am right..so far nobody in politics has raised the necessity to remove the PR benefits?

what gives you that impression

..just a guess really... I saw what the labour party did in UK in regard of the "resident not domicile" status.. but maybe MALTA has different approach being a small isolated country with more interest in keeping capitals rather then having them migrating abroad ! (I hope ! ) :)
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Postby gozomark » Fri 10 Apr 2009 11:40 GMT

Pre Malta joining the EU, PR was much more attractive

1. min tax was much lower
2. could import car tax free
3. could use health system free of charge
4. no risk of not getting visa renewed

now

1. min tax nearly doubled
2. stopped
3. stopped
4. no longer an issue for EU citizens

if you are a self employed working mainly overseas - that represents a very small minority of foreigners living in Malta

I suspect even 10% is way too high. you cant work in Malta with PR, and most foreigners pay less Maltese income tax than he PR minimum of 4,200 euros
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good!

Postby londonphoto » Fri 10 Apr 2009 13:16 GMT

in the light of what you are telling me.. it looks quite unlike on the short terms Malta will make changing on the PR status. as already gave a lot of concession in joining the UE... ; I presume The Ue and the OECD are more interested in faithing money laundry and bank secrecy then targeting a such small percentage of people enjoying low taxation... especially if their residency status is genuine and not simply for tax avoidance...
In any case I will have a chat with a Maltese accountant next week and try to have more infos !.. Mark.. thank you again.. and finger crossed !.. I would not want to go through all the process of moving and taking residency and then maybe after a couple of month find myself with not advantages at all ! ;)
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Postby john07900 » Fri 10 Apr 2009 14:21 GMT

You cannot change back from permanent to ordinary resident.

PR has very little advantage, unfortunately there are still old web sites around with pre-EU information, as well as some local accountants and advisers who still are not up to speed with the new EU rules.
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Postby gozomark » Fri 10 Apr 2009 14:57 GMT

You cannot change back from permanent to ordinary resident - I did, in 2004 or 2005, when it became less attractive. Is that a new rule John ?
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to john

Postby londonphoto » Fri 10 Apr 2009 16:50 GMT

1) I was not aware that it is not possible to go from pr to or.. are you sure?

2) The advantage of Pr is the flat 15% fee; if I have the intention to bring all my earning to Malta I will end up paying around 35% as ordinary resident !

Of course next week during my meeting with the Maltese account I will go in deep, but it seems strange that if for whatever reason they will remove the PR status, I wont be allowed to stay as ordinary resident (being a EU citizen).

Am i wrong? :(
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Postby john07900 » Fri 10 Apr 2009 17:16 GMT

I must have read it on one of those dodgy web sites I mentioned.

Whilst searching for the info though, I came across this site, which compares PR to OA, it seems to answer many questions posted on the BE site.

xxxx
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Postby gozomark » Fri 10 Apr 2009 17:23 GMT

Hi John

Ive deleted the link, and will put it in the "recommended suppliers" board as its an accountants website. It does say conversion between permits possible
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Postby john07900 » Fri 10 Apr 2009 17:29 GMT

Yes I noticed that, I appreciate it needs to go on RS, but hopefully it will reduce repeated questions for you on the same subject.
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Postby gozomark » Fri 10 Apr 2009 17:35 GMT

its a good summary of the two schemes, so thanks for finding it :D
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Postby gozomark » Fri 10 Apr 2009 17:38 GMT

the only answer I slightly query is that it says both are renewable annually - I,m fairly sure that PR cant be taken off you as long as you abide by the rules and isnt renewable, whereas OR renewal is at their discretion for non-EU citizens
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