Japan used car

Brussels is expected to initiate infringement procedures against Malta over its discriminatory registration tax on used cars, MaltaToday can reveal.

Malta’s higher registration tax on second-hand cars is currently being investigated by the European Commission’s directorate for taxation and customs, and is likely to culminate in the first stage of infringement procedures to be launched against Malta this month.
In response to a complaint from a Maltese citizen, an official from the Commission’s directorate said an infringement of EU law could arise if the tax on second-hand imports was higher than that imposed on new car imports.

Head of unit Micole Wiebke said an investigation is under way into the reduction of registration tax in order to comply with EU law, which prohibits member states from imposing any tax on EU products in excess of that imposed on similar domestic products, or so as to afford indirect protection to other products.

Malta’s tax regime on cars discriminates between new imports and used cars by setting a minimum tax charge for used cars. Both imports are subject to a tax of 50.5 to 75 per cent, according to engine capacity, but used imports have a minimum charge of Lm1,200, stepped up progressively according to engine capacity. While the tax on new cars is calculated on their cost, import and freight charges, the tax on used imports is assessed on a valuation by transport authority officials. READ MORE…