Maltese Finance Minister Launches Amnesty On Undeclared Investments

by Ulrika Lomas, Tax-News.com, Brussels

04 September 2001

The Maltese Finance Minister, John Dalli, announced last week that Maltese residents with undeclared overseas investments would be permitted to repatriate the money with no questions asked, as long as they pay a 15% withholding tax.

The government estimates that undeclared capital flight from Malta could amount to over Lm1 billion, and is anxious for Maltese citizens to regularise their financial affairs by repatriating their investments. With this in mind, said Mr Dalli, it was launching a scheme which will run until December 2002, whereby Maltese citizens with funds abroad can deposit them with Maltese banks or financial agents without having to inform the government or central bank.

Mr Dalli reassured the public that a certificate issued once the withholding tax has been paid would serve as proof of the source of the income in the event of a query from the Inland Revenue department. In a considerable over-statement, the Finance Minister said he believed Maltese citizens would take advantage of the scheme, as the increasingly common practice of information exchange means that the government now has the potential to seek out undeclared income and investments hidden in foreign institutions anyway.

Despite the fact that the scheme was officially launched on the 1st of September, Mr Dalli said last week that the final details were still under discussion, and amendments to the country's legislation with regard to exchange controls and taxation still needed to be made.

Recommended