15 Mar 2020
The Prime Minister of Malta, in a press conference held yesterday morning together with Finance Minister Scicluna and Economy Minister Schembri, announced a package of tax and economic measures in order to address the impact COVID-19 might leave on the Maltese economy.
Like other Member States, Malta’s initiative is in line with the European Commission’s recommendations, which were reflected in a press statement made by EU Competition Commissioner Vestager on Friday 13 March. The European Union usually has strict rules restricting state aid. State aid can take the form of cash grants, or preferential tax treatment from government to a particular business or industry.
Working within EU state aid rules, Member States can now adopt measures such as wage subsidies, suspensions to corporate and value added taxes of social contributions, or grant financial support directly to consumers, for instance consumers affected by cancelled services, where these are not reimbursed by the operators concerned. The Commission is also preparing a special legal framework under EU treaty rules, in order to allow EU member states to, if necessary, adopt additional national support measures to remedy a serious disturbance to the state’s economy.
The measures announced by the Maltese government yesterday aim to support those sectors of the Maltese economy which will be most affected by COVID-19, such as the tourism, hospitality, accommodation, entertainment, transport, and some manufacturing sectors.
The measures will apply to employers and self-employed persons, and are the following:
It appears that legal notices bringing these measures into effect will be published shortly. Although the fine print is yet to be seen, we feel that there are several issues which the Government of Malta should take into account. Some of the issues which need to be considered and properly addressed in relation to these measures include:
We applaud these measures, a first step which will no doubt be of benefit to the sectors of the economy which they cover, and look forward to reviewing the legal notices bringing these measures into effect as soon as they are published. The devil is always in the detail, though we’re hopeful that the solidarity being shown by the government and all in these strange times will also be the driving force in the application of these special measures.
Should you require any assistance in respect of the interpretation of these new measures as and when implementing legal notices are published please do not hesitate to reach out to your usual WH Partners contact or email us at firstname.lastname@example.org.