Amendments to the Tax Credit (Construction Waste Recycling) 2020-2023 Rules

Earlier on this year, the Government of Malta had by means of Legal Notice 179 of 2020 issued new rules granting a tax credit to authorized persons who are in possession of a permit issued by the Environment and Resources Authority for the acceptance in their quarry of construction and demolition material from third parties.  […]

Written By Stephen Balzan

On May 31, 2020
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Earlier on this year, the Government of Malta had by means of Legal Notice 179 of 2020 issued new rules granting a tax credit to authorized persons who are in possession of a permit issued by the Environment and Resources Authority for the acceptance in their quarry of construction and demolition material from third parties.  Such authorized persons benefitting from such a tax credit should during the calendar years 2020, 2021, 2022 or 2023,  provide such qualifying services at a fee not exceeding twelve euro (€12) per tonne. Such persons could claim a tax credit equivalent to five per cent (5%) of the gross fees paid to them for the provision of their services.  The tax credit could not exceed the tax chargeable on the income derived by the authorised person during that year from the provision of those services. Please refer to our website on our news section here.

The Government has now amended the said rules by means of Legal Notice 218 of 2020.  The tax incentive has now been changed and such persons will not benefit from the above-mentioned tax credits.  Instead, the chargeable income derived by such persons providing qualifying services shall benefit from a reduced rate of income tax of 5%.

The applicability of the rate of tax in accordance with these rules shall be subject to the production of such documents or other evidence as the Commissioner may require.

How can we help?  

For further information, please contact one of the firm’s tax partners, Stephen Balzan on [email protected] or Elaine Camilleri [email protected]. ACT can help you understand the changes to the tax rules and how these can impact your business.  

Apart from its offices in St. Julian’s Malta, ACT operates from a second office in Gozo, which is situated in the capital city of Victoria.  For an appointment in our Gozo office, please call on 00356 21378672 or send us an email on [email protected].