Malta ratifies tax instrument to tackle base erosion and profit shifting

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Malta ratifies tax instrument to tackle base erosion and profit shifting
The BEPS MLI will enter into force for Malta on April 1, 2019. 
Malta ratifies tax instrument to tackle BEPS
Malta on December 21 deposited with the OECD the Instrument of Ratification for the Multilateral Convention to implement tax treaty-related measures to prevent base erosion and profit shifting (BEPS MLI). 

The BEPS MLI, negotiated by over 100 countries and jurisdictions, updates the existing network of tax treaties and reduces opportunities for MNE tax avoidance. The BEPS MLI seeks to modify existing bilateral tax treaties to swiftly implement measures relating to hybrid mismatch arrangements, treaty abuse, and permanent establishment.

The BEPS MLI also strengthens provisions to resolve treaty disputes, including through mandatory binding arbitration, which has been taken up by over 25 countries.

Malta signed the BEPS MLI in June 2017. Malta intends to cover 73 of its existing tax treaties under the BEPS MLI.

The BEPS MLI will enter into force for Malta on April 1, 2019. 

“The ratification of the BEPS MLI underlines the active role that Malta plays in the development and implementation of international standards in taxation, good governance, together with the government’s determination to effectively fight all types of abuse of tax systems,” Maltese Minister for Foreign Affairs and Trade Promotion, Carmelo Abela, said.