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European Commission Announces a Positive Outlook on Malta’s rules on VAT treatment in the yachting sphereMEDIA ROOM
November 23, 2020
Malta has retained its importance in the shipping and yachting world not only because of its geographical location but also because it offers attractive and competitive incentives, thereby making Malta one of the top flags in the world. Malta’s solid roots as a maritime settlement continue to enhance and expand the island’s footing in the maritime industry.
Besides offering world-class berthing facilities to the superyacht industry, Malta offers ship and yacht owners several attractive solutions, including attractive VAT incentives for yacht and superyacht owners.
In March 2020, Malta published its guidelines updating the means in which leased pleasure yachts are to be treated for VAT purposes, with a particular focus on the use and enjoyment provisions on yacht leasing supplies.
With these recent changes duly introduced into the Maltese legal sphere, on the 30th October 2020, the Taxation and Customs Union within the European Commission, announced its withdrawal of any infringement case/proceedings relating to the rules and provisions of the Council Directive 2006/112/EC of 28 November 2006 on the common system of value-added tax (EU VAT Directive) as regards the VAT treatment of leasing of larger pleasure boats/yachts in Malta.
This decision is a welcomed update for the yachting and yacht leasing industries in Malta, and portrays the jurisdiction’s willingness to continue fostering its exponential growth in this sector in line with EU rules.
About the Authors
This article has been authored by Rachel Genovese, CSB Group Regulatory Advisory and Edward Meli, CSB Group Corporate & Business Advisor. For more information on the manner in which one can benefit from Malta’s competitive incentives in connection with the registration of yachts under the Malta Flag, please do contact us on [email protected] so that our legal professionals can guide you accordingly.