Source: Mr.George Mangion¸ PKF Malta
As published this Sunday 24th February 2013 in the Sunday Independent
At a packed hall in a five star hotel barely three days before the 2008 general election I was present when Dr Gonzi was addressing financial services practitioners at a business breakfast. His sounded bullish on the economy and did not hesitate to predict that there will be a shortage of qualified workers in the financial services sector which turned out to be true. I stood up and asked a number of questions one of which concerned the absence in the party’s manifesto on a fresh initiative to attract more permanent residents. This is more so in the wake of the uncertainty felt in U.K following the announcement to tax non domiciled high net worth individuals. Dr Gonzi replied in 2008 saying that while there were more than 300 new measures in the Party’s manifesto there is still scope to improve on our financial incentives to attract more wealth. He agreed in principle that if re-elected his government will look up the matter. Yes it took almost three years for the new scheme to be launched and unfortunately it was badly received by local estate agents and luxury properties developers saying that it was not sufficiently attractive particularly to non-EU individuals. Indeed going down memory lane one encounters schemes with varying degree of success aimed to attract high value individuals aka settlers. In the early seventies we enjoyed the wealth and income of many ex- UK servicemen who retired here living on their lucrative pensions paying only sixpence in the pound which was practically tax free. This was amended by the incoming Labour government who reasoned that it was anti-social to discriminate between residents paying the normal rates and other so –called retired people with deep pockets and gradually increased the rates of tax . Naturally as a result of such tax increases and other economic issues we suffered a drain of such retirees who migrated to other tax –free centres such as Andorra¸ Dublin and Madeira. With the change of Government in 1987 there was a new act which again started to try to lure them back.
Over the years the 1988 law worked well but essentially such applicants were barred from taking employment or engage in business unless authorised by the competent authorities. Interestingly¸ however¸ there were strong representations with the authorities to change policy in this regard. The broad consensus was if a country wants to attract settlers /non –domiciled brimming with overseas expertise and ideas in various sectors such the tourism¸ manufacturing and catering sectors we need to offer an attractive package. Sadly