This is the most common type of indirect taxes and one which is experienced with nearly each and every purchase which companies and individuals alike make on a daily basis. VAT charged on goods and services at the generic rate of 18% is one of the lowest charged rates in the European Union, second only to Luxembourg’s 17% rate.
The 18% is not applied on all the products and services. Few services can benefit from the reduced rates of 7% applicable to certain accommodation while the 5% reduced rate applies to electricity, certain medical accessories, confectionery and similar items printed matters, exclusive items used by persons with disability, importation of certain artworks, collector's items and antiques, minor repairs of shoes and leather goods, bicycles, and household lines, domestic care services, museum admissions, art exhibits, concerts, and theatres, and use of sports facilities.
Lastly, there are additional products or services which are completely exempt from VAT such as banking services, the provision of certain licensed online gambling activities and others.
Typically, import duties were mostly paid for by companies importing products from outside of the European Union. Individuals too were subject to pay import duties, however only on importation of high value items from outside of the European Union. Many small household items acquired over the internet such as many eBay purchases, books and other trivial items were exempt. However, recent changes which became effective as of 2021 will capture many other less valuable items. Import duties are charged at the rate of 10%.
This type of tax is imposed on certain goods and commodities which fall within the remit of the Excise Duty Act – Chapter 382 of the Laws of Malta. This type of tax is charged on excise goods irrelevant of their place of origin. Certain goods such as wines and spirits and manufactured tabocco products are “Harmonised Goods” which means that the excise duty is taxed on these type of products in all of Europe, albeit at different rates. Other goods classified as “Non Harmonised Goods” are classified in the 5th schedule of the same law. Some examples include cement, tyres, mobile telephone services etc...
The most common type of stamp duty is levied on insurance policies, transfer of capital assets which fall within the remit of the duty on documents and transfers act, chapter 364 of the laws of Malta and transfers of immovable properties in Malta. The transfer of shares in Maltese companies are subject to stamp duty.