The tax treatment of aviation business and operations : a Maltese and European perspective

Abstract

The scope of this thesis is to provide a comprehensive overview of the new tax treatment of aviation business and operation. The speed and efficiency of aircrafts has lead to the decline in popularity of shipping as a means of transport and the increasing importance of the aviation industry. This lead the Maltese government to introduce a new set of fiscal incentives aimed at attracting aviation operation to Malta. Malta's tax system already provided significant fiscal efficiency to investors; therefore the introduction of additional incentives significantly strengthen Malta's competitiveness in the sector. Emphasis is made on the direct and indirect tax treatment of aviation companies and their employees. Due to the mobile nature of the aviation industry, incidence of double taxation is bound to occur, therefore providing an adequate system for double taxation relief is fundamental in attracting investment in this sector. Malta provides a number of mechanisms for double taxation relief making it an attractive jurisdiction to make business in. It is also imperative to assess the impact that other legislation might have on the industry. A comparative analysis with other European jurisdictions is necessary in order to assess Malta's competitiveness in the aviation industry.