A legal notice was recently issued by the Ministry of Finance in
Malta to transpose paragraph 5 of Article 105a of Council Directive
2006/112EC on the common system of value added tax, as subsequently
amended.
L.N.231 of 2023 has introduced a new reduced rate of value added
tax on the hiring of pleasure boats to a person according to an
agreement for any term or part of a term that, when added to the
term of a previous hiring of the same goods or of other goods of
the same kind to the same person during the previous 12 months
ending on the date of the beginning of the existing hiring, does
not exceed 5 weeks. The Vat rate which is applicable to this
service is 12%.
These rules apply to short term charters or hirings of up to 5
weeks in a 12-month period, even if not enjoyed in one continuous
five-week period but in several parts, provided the charter or
hiring is in respect of the same pleasure boat and made to the same
person. They come into force on the 1st Janu
