Fiscal incentives under the industrial development act 1988 : a critical review

Abstract

The aim of this work is to produce a critical study of the fiscal incentives granted under the Industrial Development Act 1988. A background to the objectives of the Act and its enactment process is given in the first instance. The technicalities of each fiscal incentive as set out in the Act are then discussed in detail. The relative provisions are specifically examined for their adequacy and practicality in the light of statutory definitions and conditions, the extent of the benefit afforded to a qual probability of success. Furthermore, a comparative study is made of each fiscal incentive with the corresponding provision under the Aids to Industries Ordinance 1959 and with similar incentives available in other countries particularly Mediterranean countries. The incentives are then reviewed in the light of the EEC Treaty in the event of the admission of Malta to the EEC. The administrative implications of the Act with respect to fiscal incentives create numerous problems mainly related to their application. These are discussed towards the end of this work. Ultimately, the role of fiscal incentives is extensively defined with special reference to their adequacy in attracting foreign investment to Malta and in encouraging local manufacturing and service related companies towards attaining higher economical achievements.