COMMERCIAL BANKS (SPECIAL TAX) ACT (specialtax)

[ CAP. 402. 1

COMMERCIAL BANKS (SPECIAL TAX)

CHAPTER 402

COMMERCIAL BANKS (SPECIAL TAX) ACT

Further to impose a one time tax of 15% on the profits of Commercial

Banks.

(26th June, 1998) *

ACT XV of 1998 , as amended by Legal Notice 426 of 2007 .

The short title of this Act is the Commercial Banks

(Special Tax) Act.

In this Act, unless the context otherwise requires -

"commercial bank" means a credit institution licensed under the

Banking Act, but does not include such an institution which has a

licence limited to dealing only in currencies other than the euro and

does not include the bank known as Lohombus Bank Limited;

"Commissioner" means the Commissioner of Inland Revenue;

"profits" means chargeable income as determined in accordance

with the Tax Acts but does not include profits from loans advanced

by commercial banks to individuals to assist them in the acquisition

or construction of a house to be used as their personal residence;

"special tax" means the tax imposed under this Act;

"Tax Acts" means the Income Tax Act and the Income Tax

Management Act;

"tax year" means the accounting period of the commercial bank

ending at any time during the calendar year 1997 and as established

under section 11 of the Income Tax Act.

Subject to the provisions of this Act, a special tax shall be

payable at the rate of fifteen per centum upon the profits of a

commercial bank accruing in or derived from Malta or elsewhere

and whether received in Malta or elsewhere in respect of the tax

year

Provided that where a commercial bank operates in Malta

only as a branch of a foreign bank, then for the purposes of this

section, profits shall be deemed to be the profits of the commercial

bank properly attributable to the operations of the branch or

branches in Malta.

(1) The provisions of the Tax Acts with respect to returns,

assessments, appeals, collection and penalties shall apply to the

special tax imposed under this Act, and the Commissioner shall

have all the powers in relation to the special tax as provided in the

Tax Acts in relation to income tax, subject however to the

provisions of the following subsections of this section.

(2)

The provisions of the Tax Acts with respect to set-off or

*See Government Notice No. 499 of 26th June, 1998.

COMMERCIAL BANKS (SPECIAL TAX)

refunds shall not apply to the special tax.

(3) The return to be submitted for the purposes of this Act shall

consist of the audited accounts of the commercial bank for the tax

year together with the income tax computation relative thereto.

(4) The return shall be submitted to the Commissioner by the

30th June, 1998, and shall be accompanied by the payment of the

special tax due.

The special tax payable under this Act shall not for the

purposes of article 14 of the Income Tax Act be considered to be an

expense wholly and exclusively incurred in the production of the

income for the year of assessment corresponding to the tax year or

for any other year of assessment.