The importation into Malta of a yacht or aircraft intended for commercial use is subject to VAT at the standard rate of 18%. Having said this, it has been possible for businesses to request a VAT deferment, whereby the Commissioner for Revenue releases the importer from his obligation of making the physical VAT payment. In such case, businesses were required to put in place a bank guarantee in an amount equivalent to 20% of the VAT which would otherwise have been paid to the tax authorities.
As a result of the recent changes to the local importation procedures, VAT deferment may now be obtained without the requirement of setting up a bank guarantee where the commercial yacht or aircraft is imported by:
- A Maltese entity; or
- An EU entity, on the condition that a local VAT representative is appointed.
Where the importation of a commercial yacht or aircraft is made by a non-EU entity, the requirement for a bank guarantee remains, however it shall now cover the VAT amount on 0.75% of the value of the yacht, which would be capped at EUR 1 million.