Cap. 368 Art. 3Charge to tax. 

(1) There shall be charged and levied by the Authority on account of the Government a registration tax and a circulation licence fee at the rate or in the amount specified in this Act on the registration and licensing of -

(a) every motor vehicle imported or brought into Malta, and

(b) every motor vehicle manufactured in Malta, unless the vehicle is the subject of an exemption under this Act or is already registered and licensed in another country and is brought or imported temporarily into Malta in accordance with the provisions of article 18:

Provided that the payment of registration tax in respect of a used motor vehicle which is registered with the Authority by authorised motor vehicle importers or authorised motor vehicle dealers may be deferred until such date in which that vehicle is licensed by the Authority:

Provided further that should the registration tax and, or value applicable at the date of payment of the tax be lower than that applicable on the date of deferred registration, an authorised motor vehicle importer or an authorised motor vehicle dealer shall pay the registration tax applicable at date of payment of the said registration tax.

(1A) As from the 1st January 2024 and thereafter, the registered owner of an M1 motor vehicle originally registered in any country other than a third country prior to the 1st January 2009 and which was subsequently registered in Malta after such date and is still licensed and for which the registration tax and annual circulation licence fee imposed were in accordance to the Second Schedule, Category A and the Fourth Schedule, Category 1A, shall have the right to shift the registration tax and annual circulation tax regimes as explained below: Provided that, upon exercising the right to pay the registration tax and annual circulation licence fee leviable in terms of the Second Schedule, Category AAA for registration tax and Fourth Schedule, Category 2 for the annual circulation licence fee instead of that leviable in terms of the paragraphs of the Second Schedule, Category A and the Fourth Schedule, Category 1A, such person shall be obliged to receive a refund from the Authority in credit for any difference which there may be between the sum total of registration tax and annual circulation licence fees payable up to such date calculated in terms of the paragraphs of the Second Schedule, Category AAA for registration tax and the Fourth Schedule, Category 2 for the annual circulation licence fee and the sum total of registration tax and annual circulation licence fees payable up to such date calculated in terms of the paragraphs of the Second Schedule, Category A and the Fourth Schedule, Category 1A.

(1B) The owner who decides to exercise his right in terms of sub-article (1A) shall be obliged to receive a credit on that particular licensed vehicle which shall be deducted from the annual circulation licence, if any, and this between the difference of the total sums of registration tax and annual circulation licence fees calculated in the manner established in the proviso to sub-article

(1A) contemporaneously with the exercise of such right and the payment, for the first time, of the circulation licence fee in terms of the Fourth Schedule, Category 2. st

(1C) As from the 1 January 2024 and thereafter the registered owner of a motorcycle originally registered in any country other than a third country prior to the 1st January 2009 and which was subsequently registered in Malta after such date and is still licensed and for which the registration tax and annual circulation licence fee leviable were in accordance to the Second Schedule, Category C and the Fourth Schedule, Category 3, shall have the right to shift the registration tax and annual circulation tax regimes as explained below:

Provided that upon exercising the right to pay the registration tax and annual circulation licence fee leviable in terms of the Second Schedule, Category CC for registration tax and the Fourth Schedule, Category 4 for the annual circulation licence fee and instead of that leviable in terms of paragraphs of the Second Schedule, Category C and the Fourth Schedule, Category 3 such person shall be obliged to receive a refund from the Authority in credit for any difference which there might be between the sum total of registration tax and annual circulation licence fees payable up to such date calculated in terms of the paragraphs of the Second Schedule, Category CC for registration tax and the Fourth Schedule, Category 4 for the annual circulation licence fee and the sum total of registration tax and annual circulation licence fees payable up to such date calculated in terms of the paragraphs of the Second Schedule, Category C and the Fourth Schedule, Category 3.

(1D) The owner who decides to exercise his right in terms of sub-article (1A) shall be obliged to receive a credit on that particular licensed vehicle which shall be deducted from the annual circulation licence, if any, and this between the difference of the total sums of registration tax and annual circulation licence fees calculated in the manner established in the proviso to sub-article (1A) contemporaneously with the exercise of such right and the payment, for the first time, of the circulation licence fee in terms of the Fourth Schedule, Category 4.'

(2) There shall also be charged and levied by the Authority on account of the Government a registration tax and a circulation permit fee as specified in this Act in respect of -

(a) motor vehicles hired or leased from a vehicle hire undertaking licensed in another Member State which are brought into Malta under a contract of lease or hire by a person residing in Malta for a period which exceeds thirty days to be reckoned from the date of arrival of the said motor vehicle in Malta; and

(b) motor vehicles hired or leased from a vehicle hire undertaking licensed in another Member State which are brought into Malta under a contract of lease or hire by any person other than a person residing in Malta and which does not qualify under any of the exemptions or concessions specified in article 18 or, in the event that such motor vehicles qualify for such an exemption, following the expiry of the period for which such motor vehicles have been exempt [together with the period stipulated in article 4(4)] if such motor vehicles continue to be used on the road in Malta after the expiry of such period: Provided that the provisions of this article and of article 4 regulating motor vehicles brought into Malta from another Member State under a contract of lease or hire shall only apply to motor vehicles which are not used for hire or reward.

(3) With regard to motor vehicles specified in sub-article (2), the registration tax payable shall be as follows:

(a) where the contract of lease or hire expires prior to the lapse of four years to be reckoned from the date of arrival of the said motor vehicle in Malta, where such motor vehicle is brought into Malta by a person residing in Malta or by any person other than a person residing in Malta in such cases where none of the exemptions or concessions specified in article 18 apply, at the rate or in the amount specified in the First Schedule or the Second Schedule, as the case may be, which shall be applied at the percentage rates specified in the Fifth Schedule: Provided that, with regard to motor vehicles brought into Malta from another Member State by any person other than a person residing in Malta which qualify under any of the exemptions or concessions specified in article 18 and which continue to be used on the road in Malta after the expiry of the period for which they have been exempt, the period is to be reckoned from the date of expiry of the exemption or concession, as the case may be;

(b) where the contract of lease or hire expires after the lapse of four years to be reckoned from the date of arrival of the said motor vehicle in Malta, where such motor vehicle is brought into Malta by a person residing in Malta or by any person other than a person residing in Malta in such cases where none of the exemptions or concessions specified in article 18 apply, at the full rate or in the amount specified in the First Schedule or the Second Schedule, as the case may be: Provided that, with regard to motor vehicles brought into Malta from another Member State by any person other than a person residing in Malta which qualify under any of the exemptions or concessions specified in article 18 and which continue to be used on the road in Malta after the expiry of the period for which they have been exempt, the period is to be reckoned from the date of expiry of the exemption; and

(c) where the contract of lease or hire expires prior to the lapse of four years to be reckoned from the date of arrival of the said motor vehicle in Malta and such motor vehicle is brought into Malta by a person residing in Malta or by any person other than a person residing in Malta in such cases where none of the exemptions or concessions specified in article 18 apply, in the event that such contract of lease or hire is extended for a further period which does not, when added to the period during which the vehicle was already being used on the road in Malta, exceed four years from the date when such motor vehicle was first brought into Malta, applicant shall pay a further sum by way of registration tax for the period for which the contract of lease or hire has been extended in terms of the Fifth Schedule, less the amount of registration tax already paid when the vehicle was first brought into Malta: Provided that, in the event that the contract of lease or hire is extended following the expiration or termination of the first extension, for whatsoever period, the registration tax payable shall be at the full rate or in the amount specified in the First Schedule or the Second Schedule, as the case may be, less the amount of registration tax already paid when the vehicle was first brought into Malta.

(4) (a) With regard to the case specified in sub-article (3)(a), where the contract of lease or hire is terminated prior to the expiration of the term on the basis of which the registration tax had been calculated and the said motor vehicle is taken out of Malta, the person who had paid the registration tax, or his authorised assignee, shall be entitled to a refund of a sum equivalent to the nominal amount of residual registration tax applicable to the said motor vehicle at the rate or in the amount as specified in the Fifth Schedule.

(b) With regard to the case specified in sub-article (3)(b), when the contract of lease or hire expires, or is terminated prior to the lapse of the term stipulated in the said contract, and the motor vehicle is taken out of Malta, the person who had paid the registration tax, or his authorised assignee, shall be entitled to a refund of a sum equivalent to the nominal amount of residual registration tax applicable to the said motor vehicle at the rate or in the amount as specified in the Fifth Schedule.

(c) With regard to the case specified in sub-article (3)(c), where the contract of lease or hire as extended, expires, or is terminated prior to the term stipulated in the said contract, and the motor vehicle is taken out of Malta, the person who had paid the registration tax, or his authorised assignee, shall be entitled to a refund of a sum equivalent to the nominal amount of residual registration tax applicable to the said motor vehicle at the rate or in the amount as specified in the Fifth Schedule.

(d) Upon the exportation and deregistration of a motor vehicle which had been registered in Malta by a vehicle hire undertaking established in Malta, being a motor vehicle which had been used solely and exclusively for the purpose of leasing or hire, such vehicle hire undertaking may apply with the Authority for a refund equivalent to the nominal amount of residual registration tax applicable to the said motor vehicle at the rate or in the amount as specified in the Fifth Schedule.

(5) With regard to the motor vehicles specified in sub-article (2)(a) and (b), where the contract of lease or hire expires or is terminated prior to the lapse of four (4) years from the date when such motor vehicle was first brought into Malta, and the motor vehicle is not taken out of Malta but continues to be used on the road in Malta by a person residing in Malta or by any person other than a person residing in Malta in such cases where none of the exemptions or concessions specified in article 18 apply, not being the person who had originally brought the said motor vehicle into Malta from another Member State under a contract of lease or hire, such person who shall continue to use the said motor vehicle on the road in Malta under a new contract of lease or hire from a vehicle hire undertaking licensed in another Member State shall pay a sum, by way of registration tax, for the period for which the said person has taken the said motor vehicle under a contract of lease or hire in terms of the Fifth Schedule, less the amount of registration tax already paid when the vehicle was first brought into Malta or when registration tax was once again paid on the said motor vehicle in the event that the said motor vehicle continued to be used on the road in Malta under a new contract of lease or hire from a vehicle hire undertaking licensed in another Member State, as the case may be:

Provided that, in the event that the total period of time for which a motor vehicle brought into Malta continues to be used on the road in Malta under contracts of lease or hire taken out from a vehicle hire undertaking licensed in another Member State exceeds four years, upon the final registration which will extend the period for which such motor vehicle shall be used on the road in Malta beyond four years, registration tax shall be charged at the full rate or in the amount specified in the First Schedule or the Second Schedule, as the case may be, less the amount of registration tax already paid when the vehicle was first brought into Malta or when registration tax was once again paid on the said motor vehicle in the event that the said motor vehicle continued to be used on the road in Malta under a new contract of lease or hire from a vehicle hire undertaking licensed in another Member State, as the case may be.