Embattled Spanish gambling group Codere SA is reported to be reviewing its financial structures, seeking to increase its operating presence within Malta, as corporate governance moves to lessen the firm’s fiscal liabilities.
The Bolsa-Madrid enterprise seeks to replicate the operating structure of many European gambling counterparts, maintaining its management headquarters in Madrid, whilst migrating certain operational departments to Malta.
At present, Malta’s corporate tax-rate amounts to 35% for domiciled firms, one of the highest % for a European Union member state.
Nevertheless, the island has become a popular operational hub for digital and financial enterprises maintaining a tax framework which significantly discounts tax on transactions and profits for non-domiciled firms.
In 2017, European Commission reports found that ‘true’ Maltese corporation taxes averaged around 5% a significantly lower rate than the EU-28 average of 22%.
Malta’s corporate tax framework has been severely criticised by EU counterparts, with a number of MEPs labelling the island as ‘Europe’s Panama.’
Seeking to harmonise Europe’s corporate tax structures, for 2019 the EU Council seeks to introduce a mandatory 3% point-of-consumption tax on digital transactions, referred to as the ‘EU common digital tax policy’.
France and Germany lead the proposal, which will likely be contested by the member states of Malta, Ireland, Cyprus and Luxembourg.
At home, a troubled Codere faces the reality of increased duties in 2019, as the socialist democrat PSOE minority government seeks to implement increased taxes on registered multi-national corporations, as the European Union review its 2019 Budget proposal.