Issue link: https://maltatoday.uberflip.com/i/725667
MATTHEW VELLA TOUGH competition over the most favour- able tax rates between EU countries has been ongoing for years. But for Malta, retaining its favourable tax regime for foreign companies has been a diplomatic tussle with the Europe- an Commission ever since Brussels got serious over tax avoidance. An analysis by MaltaToday into Malta's tax receipts sheds light on the reason why tax jus- tice campaigners and MEPs from countries who suffer massive taxation drain, have often targeted the island's tax system for foreign shareholders. Every year, anything between a massive €3.5 to €4 billion that should be paid in taxes on profits generated outside of Malta, are wiped clean off the slate by the Maltese taxman so that a 'trickle' of €200 million in tax receipts is retained in Malta. Malta's full imputation tax system allows a German multinational to set up its 'tax resi- dency' company in Malta, perhaps manned by just one secretary and an accountant. But when it books its foreign income into its Maltese company, the ultimate beneficial owners – back in Germany – can claim an 85% refund on the Malta tax levied on their dividends. The result is an effective tax rate of 5%... instead of the standard corporate 35%. Newspaper post 3 SUNDAY • 11 SEPTEMBER 2016 • ISSUE 879 • PUBLISHED EVERY WEDNESDAY AND SUNDAY SUNDAY • 11 SEPTEMBER 2016 • ISSUE 879 • PUBLISHED EVERY WEDNESDAY AND SUNDAY • PUBLISHED EVERY WEDNESDAY AND SUNDAY maltatoday YOUR FIRST READ AND FIRST CLICK OF THE DAY WWW.MALTATODAY.COM.MT PGS 10-11 Libyan visa allegations Witnesses scared of coming forward due to retribution, Libyan claims €1.40 Malta used to wipe out €4 billion in foreign tax MIDI puts €145 million price tag on Manoel Island SAVIOUR BALZAN MIDI plc, the consortium behind Tigné Point, is seeking to sell its 99-year con- cession at Manoel Island for the princely sum of €145 million, despite having com- mitted itself to develop the land for a lux- ury villa area. MaltaToday has learnt that a prominent Maltese consortium made an offer for €110 million, as well as an additional €23 million that MIDI has yet to pay the Mal- tese government. But the offer was turned down when the MIDI owners informed the interested buyer they would alter the asking price. The revelation comes at a time when the Gzira mayor and environmental groups have demanded access to the public fore- shore at Manoel Island, which was totally sealed off for years before Kamp Emer- genza Ambjent activists and mayor Con- rad Borg Manche yesterday broke down the metal fencing (page 3). Under the 99-year concession negoti- ated with the late MIDI chairman Albert Mizzi, the government cannot regain control of the site despite the breach of conditions to successfully develop the area. The business group however carried out an extensive €30 million renovation on the fortress and historical buildings, but were also granted a casino licence for the area. Until six years ago, MIDI was consider- ing turning Fort Manoel into a 55-suite boutique hotel, and turn the former mili- tary parade ground into a concert venue. Plans also included a 'marina village' of low-rise residential units, projected to sell at roughly the same price as Tigné Point's more expensive apartments. MORE HIGH-RISE Competitive designs for HB Group's 50-storey Metropolis project offer glimpse into futuristic streetscape for Gzira Crunch time on high-rise at the ERA 4 Down in the concrete jungle 'Sliema development is out of control' says Sliema mayor Anthony Chircop As they see it: architects' plans for the Metropolis high-rise in Gzira, which is yet to be developed by Jalal Husni Bey's group SUNDAY • 11 SEPTEMBER 2016 • ISSUE 879 • PUBLISHED EVERY WEDNESDAY AND SUNDAY today today • PUBLISHED EVERY WEDNESDAY AND SUNDAY today • PUBLISHED EVERY WEDNESDAY AND SUNDAY 14 15