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Excise Duty

Excise Duty is a National tax, imposed by the Excise Duty Act – Chapter 382 of the Laws of Malta, on certain goods and commodities which are consumed or made use of, as in the case of a service, in Malta.

Excise Duty is imposed on all Excise Goods which are released for consumption unless they are legally exempted but irrespective of whether they are locally produced or coming from EU member states or third countries and whether Excise Duty had been previously paid in the member state of dispatch or any other country.

Harmonised Goods

Harmonised Goods are subject to Excise Duty throughout all member states and are included in the relative EU Directives and Regulations. These categories of Excise goods are ‘Alcohol and Alcoholic Beverages’ which include wines and spirits, ‘Manufactured Tobacco Products’ and ‘Energy Products’ composed largely of mineral oils.

The 2nd, 3rd & 4th schedules (Harmonised) are incorporated in the Excise Duty Act. Each schedule, containing a different category of excise goods, is divided into two columns.  The first column gives the description of the excise good while the second column shows the relative excise duty rate. 

Non-Harmonised Goods

Non-Harmonised Goods are those commodities that are subject to excise tax and are regulated by the same act and are classified in the Fifth Schedule.

Schedules 5A – 5H, incorporated in the Excise Duty Act – Chapter 382, define all the Excise Commodities and services upon which excise duty is imposed.  Each schedule, containing a different category of excise goods, is divided into two columns.  The first column gives the description of the excise good while the second column shows the relative excise duty rate. 

A natural or legal person (or a group of persons), possessing a valid Maltese VAT registration who during the course of his business would like to trade in Excise goods under a duty suspension arrangement, including excise goods received from abroad, may register with Customs as an Excise Trader.  Foreign entities can also be registered in Malta as Excise Traders if they are registered locally with the VAT department and have a fiscal representative in Malta.

These traders, after having filed an application with the department, submitted all requested documentation, passed through a due diligence exercise and raised a guarantee will be given the status by the Customs Department to operate either as an authorized Warehouse Keeper, Excise Registered Consignee, Excise Registered Consignor. or Excise Registered Merchant, as per Article 10 in the Excise Duty Act.  

Tax Warehouse

Tax warehouse means a place where excise goods are produced, processed, held, received or dispatched under duty suspension arrangements by an authorised warehouse keeper in the course of his business, subject to certain conditions laid down by the Commissioner.


Authorised Warehouse Keeper

An Authorised Warehouse Keeper can apply for more than one Tax Warehouse.  If the economic operator intends to import Excise Goods from third countries and hold them under an excise/customs duty suspension, the trader must apply for a Customs Warehouse.  They also require to be registered with the department, provide an adequate Bank Guarantee and keep records of operations.    Each Authorized Warehouse Keeper and each Tax Warehouse is given a unique Excise Number and a Certificate of Registration.  All relative data is entered in the SEED (System of Exchange of Excise Data) which is an EU wide electronic system. 


Registered Consignees

These traders, unlike authorised warehouse keepers can only receive Excise Goods moving under a duty suspension arrangement from another member state.  These businesses cannot hold, produce, process or dispatch excise goods under a duty suspension arrangement.  They also require to be registered with the department, provide an adequate Bank Guarantee and keep records of operations. They are however also provided with a unique Excise Number and a Certificate of registration and all relative data is entered in the SEED.


Registered Consignors

These traders, unlike authorised warehouse keepers can only dispatch Excise Goods under a duty suspension arrangement to another member state upon their release for free circulation (i.e. customs duty being settled).  They cannot hold, produce, or process excise goods under a duty suspension arrangement.  They also require to be registered with the department, provide an adequate Bank Guarantee and keep records of operations regarding such operations. These are however also provided with a unique Excise Number and a Certificate of Registration and all relative data is entered in the SEED (System of Exchange of Excise Data).


Registered Merchants

These economic operators must be a professional trader without the status of authorised warehouse keeper. This trader may, in the course of his business, dispatch and, or receive goods subject to excise duty, mentioned in Part B of the Fourth Schedule and, in Schedule Five A, B, C, D, E, F, G, H.  


Rebates

Rebates are regulated by The Excise Duty Act Chapter 382 of the Laws of Malta. They refer to fuel - gas oil and diesel, consumed for a specific purpose.

In order for an economic operator or a private individual as the case may be, to qualify for this scheme, there are certain requisites and procedures that need to be followed. 

Presently there are two types of fuel rebates that one may apply for. In both instances the fuel must either be gas oil 0.1 Sulphur or diesel fuel. The fuel being referred to must always be purchased in a state of having been physically matched either with Red or Green dye.

Red gas oil may only be consumed for commercial navigation as outlined in the fourth schedule of the Excise Duty Act. Alternatively, green gas oil is specifically used for heating purposes.

In order for an economic operator or a private individual to apply for rebates, there is a procedure in place that needs to be followed. A formal request is submitted to the Department claiming back the excess excise duty paid on the fuel consumed. The raised claim must be supported by the necessary documentation as required such as logbooks, invoices, as well as other papers showing the fuel consumption. Other documentation may also be requested for additional clarification depending on the particular case. 

Updated Excise Directorate 12.08.20