Regulations, 2010

L.N. 107 of 2010

MALTA ENTERPRISE ACT

(CAP. 463)

Enterprise Support Incentives Regulations (Amendment)

Regulations, 2010

IN exercise of the powers conferred by article 5 of the

Malta Enterprise Act, the Minister of Finance, the Economy and

Investment has made the following regulations

The title of these regulations is the Enterprise Support

Incentives Regulations (Amendment) Regulations, 2010, and they

shall be read and construed as one with the Enterprise Support

Incentives Regulations, 2008, hereinafter in these regulations referred

to as '' the principal regulations''.

Regulation 10 of the principal regulations shall be

renumbered as regulation 13 thereof.

Immediately after regulation 9 of the principal regulations,

there shall be added the following new regulations

(1)

Where the Corporation is

'' Assistance to

counter effects of

satisfied that an undertaking that was not in

the global

difficulty on the 1 st July 2008 but entered in

financial and

economic crisis.

difficulty thereafter as a result of the global

financial and economic crisis, requires

assistance to counter the effects of such

crisis, the Corporation may provide such an

undertaking with a cash grant that may not

exceed the limits set in sub-regulation (2) in

accordance with the terms and conditions

set out in the Guidelines

Provided that an undertaking shall not

qualify for this assistance if it was in

difficulty before the 1 st July 2008 in terms

of the Community Guidelines on State Aid

for Rescuing and Restructuring Firms in

Difficulty

(Official

Journal

C244,

01.10.2004).

(2) Any assistance that may be

provided under sub-regulation (1) shall be

in conformity with Communication from

the Commission – Temporary Community

framework for State aid measures to support

access to finance in the current financial and

economic crisis (Official Journal C83 of 7 th

April 2009). The amount of de minimis aid

that an undertaking may receive under these

regulations may not exceed the amount of

five hundred thousand Euro (€500,000)

during the period starting from 1 st January

2008 to 31 st December 2010. This

maximum threshold includes all aid granted

as de minimis aid from the Corporation as

well as from any other entity.

(3) The Corporation shall no longer

grant approval for the purposes of sub-

regulation (1) after the 31 st December 2010.

Where the Corporation is

Assistance for

undertakings

satisfied that an undertaking is carrying on a

carrying on a

manufacturing

manufacturing activity that may contribute

activity in

to the economic development of Gozo, the

Gozo.

Corporation may provide such an

undertaking with a cash grant as established

in these regulations and in the Guidelines to

cover the necessary transport costs or part

thereof, incurred by the undertaking in

transporting between Malta and Gozo

machinery, plant, materials, goods or

products connected with its manufacturing

activities in Gozo.

(1)

Where the Corporation is

Tax credits for

micro

satisfied that an undertaking carrying out a

enterprises and

the self-

trade or business requires assistance to

employed.

expand, innovate or invest in its’ business in

Malta, the Corporation may provide such an

undertaking with a tax credit. The intensity

of the tax credit shall be in accordance with

the terms and conditions set out in the

Guidelines

Provided that this benefit shall be

calculated on the eligible costs incurred as

from 1 st January 2010 till the 31 st December

2011

Provided further that the total amount

of tax credits that may be granted in terms

of this regulation shall not exceed twenty

five thousand Euro (€25,000).

(2) In order to qualify for the benefit

under sub-regulation (1), the undertaking

(i) shall not employ

more

than

nine

full-time

employees, or equivalent, in its

trade or business as on the 10 th

November 2009

Provided that apprentices

and students shall not be treated

as employees for the purpose of

this sub-regulation; and

(ii) shall

have

a

turnover or annual balance sheet

total that does not exceed two

million Euro (€2,000,000).

(3) The tax credit referred to in this

regulation shall be due as a deduction from

tax payable by an undertaking on its

chargeable income derived from its trade or

business for that year of assessment

commencing on the 1 st January of the year

immediately following the year in which the

eligible costs are undertaken, and, where the

tax credit, for that year of assessment,

exceeds the income tax payable by such an

undertaking for that year, the excess in the

tax credit shall be allowed to be carried

forward to the subsequent year of

assessment and deemed to be a tax credit for

that year

Provided that a tax credit shall not

give rise to a right to a refund of tax.

Provided further that unutilised tax

credits can only be availed of until year of

assessment 2014.

(4) Where an undertaking has

benefited from the provisions of this

regulation, the tax credit shall be deemed to

have relieved from tax so much of that

undertaking’s chargeable income which,

when multiplied by the rates of tax at which

it was chargeable in that year, is equal to the

tax credit on the investment; and where the

undertaking is a company and such

undertaking or any subsequent company

distributes the income which is so deemed

to have been relieved from tax, such

undertaking or undertakings shall state in

the dividend warrant pertaining to any such

distribution that such income has been

relieved from tax by a tax credit in

accordance with this regulation; and the tax

which has so been relieved shall not be

available for refund for any purpose of the

Income Tax Act.

(5) (a)

In the case of an

undertaking which is a company, the

chargeable income which is deemed to have

been relieved from tax in accordance with

sub-regulation (5) shall, for the purposes of

the Income Tax Act, be allocated to the

Final Taxed Account of the company in

question and any dividends, or part thereof,

distributed from such income shall be

exempted from income tax in the hands of

the members of the company on receipt of

such distribution.

(b) Where a dividend referred to in

paragraph 5(a) is distributed to a member

which is also a company, in this sub-

regulation is referred to as ''the second

company'', the said dividend shall likewise

be distributed by the second company to its

members in the form of dividends exempt

B B 1212

from income tax in the hands of the

recipients, and where a member of the

second company is again a company, the

preceding provisions shall apply mutatis

mutandis as though references to the first

company were references to the second

company, and as though

references

therein to the second company were

references to that member, and the principle

set out in this sub-regulation shall continue

to be applied for as long as such income or

part thereof to which this regulation applies

are distributed by way of dividends.

(6) In case of a company, no tax

credit shall be due to an undertaking under

this regulation unless it is claimed in the

appropriate section of a tax return submitted

by electronic means by not later than the

relative tax return date.

(7) Applications for assistance under

this regulation shall reach the Corporation

by not later than the 31 st March 2012.''.