Croatian EU Membership to catalyse investor’s interest in Malta

Poland’s Prime Minister Donald Tusk,  who assumes the presidency of the EU bloc, claimed,after talks with the leaders of Denmark and Cyprus, who take over the rotating leadership of the EU in 2012,  that Croatia could sign up its European Union entry deal as early as this year.

Croatia has concluded another two policy chapters leading to EU Membership and has now closed 30 out of 35 chapters.  EU Membership would serve as a catalyst to further bolster the already excellent economic ties existing between these two countries.  At present, Malta and Croatia have signed and ratified one of the most advantageous double tax treaties, the most salient features may be summarised as follows:-

• Dividends paid by a Croatian subsidiary to its Maltese holding is subject to a tax charge of just 5% of the gross amount of the dividends;
• Interest charged in Croatia and payable to a resident in Malta are subject to Maltese tax (usually nil);
• Royalties charged in Croatia and payable to a resident in Malta are subject to Maltese tax (usually nil)

EU Membership by the former Yugoslav republic, shall further incentivise investment, with the transposition of EU Directives, as well as the elimination of import and custom duties.

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