The bill no. 173 (Budget measures Implementation bill) is currently being debated at the Maltese Parliament.  This bill suggests the introduction of a new proviso to article 12(1)(u)(1) of the Income Tax Act (CAP 123), which reads the following:

“Provided further that the exemption contemplated by this paragraph shall not apply to a dividend derived from a participating holding in a body of persons resident for tax purposes in a jurisdiction that is included in the EU list of non-cooperative jurisdictions for a minimum period of three (3) months during the year immediately preceding the year of assessment. Where such three (3) months are consecutive and fall in two (2) subsequent consecutive basis years, the exemption shall not apply in respect of any such dividend derived in any one (1) of the two (2) years”

This means that an exemption from tax of income derived from a qualifying participating holding shall not apply to a dividend derived from a participating holding in a body of persons resident for tax purposes in a jurisdiction that is included in the EU list of noncooperative jurisdictions  for a minimum period of 3 months during the year immediately preceding the year of assessment.

For the final approval this bill has to pass three readings at the Parliament.