Luxembourg received harsh criticism over the last few weeks after confidential reports leaked to the International Consortium of Investigative Journalists (ICIJ). They received over 28,000 pages of confidential reports which included hundreds of private tax rulings in which Luxembourg provided favourable tax treatment to selected corporations.
Luxembourg denied offering these special deals to companies, the documents on the other hand confirm them. Among the companies are Pepsi, Deutsche Bank, AIG, Axa Group, Commerzbank AG, Credit Suisse, Gazprom, Vodafone and the Volkswagen Group. They all have received favourable tax deals saving them billions in taxes.
The chief executive for Finance, Nicolas Mackel said that the taxation system of Luxembourg is competitive, but that it is or unfair or unethical. The states in the European Union can create their own tax laws and Luxembourg has been well-known as a favourable country for a long time. However, a preferential treatment for selected companies is not legal, and other states are criticising these practices now as they have come to light. These cases are now being further investigated.
Luxembourg is not the only country offering tax structures that can help companies to save taxes. Malta’s taxation can be favourable if a certain company structure is followed. However, the tax system in Malta does not offer favourable treatment to anyone and the same laws apply to everyone. The tax laws in Malta are in line with the laws of the European Union, and the competitiveness within the Union remains. Malta is not a suitable country for every company, but for some it might be a good opportunity.
It is possible to get a 6/7 refund for corporation tax in Malta, but to achieve this it is necessary to move the company operations to the islands, and to follow the process for the refund correctly. Achieving a tax reduction by following procedures with a company in Malta is absolutely legal and it is not considered tax evasion. At the office of Dr. Werner & partner we are assisting entrepreneurs and companies wanting to make use of legal instruments for reducing the tax burden. You are welcome to contact us if you would like to schedule a personal consultation.
