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Representation in Malta
News article19 May 2022Representation in Malta1 min read

Car taxation: Commission decides to refer MALTA to the Court of Justice of the European Union over its legislation on annual circulation tax

Car Malta

The European Commission has today decided to refer Malta [INFR(2018)2362] to the Court of Justice of the European Union for taxing used cars imported from other Member States more heavily than used cars purchased on the Maltese market.

In the absence of harmonisation of car taxes, each Member State can arrange its tax measures in accordance with its own assessments. However, Article 110 TFEU requires each Member State to select and arrange car taxes in such a way that they do not have the effect of promoting sales of domestic second-hand cars and so discourage the transfer of similar second-hand cars from other Member States.

Currently, cars first registered in Malta since 1 January 2009 are subject to a generally higher annual circulation tax than those registered before that date, due to a difference in the way the tax is calculated, in the context of a reorganisation of the car taxation system in Malta.

However, the Maltese car taxation system does not take into account the date of the first registration of the vehicle, where registration took place in another Member State, but rather the date of registration in Malta. As a result, vehicles registered in other Member States before 1 January 2009 and brought to Malta after that date are subject to a higher annual registration tax than similar vehicles already registered in Malta before that date.  

This discriminatory effect is not compatible with Article 110 TFEU, which prohibits discrimination against imported products.


The Commission sent a reasoned opinion to the Maltese Authorities on 9 June 2021 formally requesting them to amend, within two months, this legislation.

The response given by Malta to this reasoned opinion was not considered satisfactory.

For More Information

Link to the MEMO


Publication date
19 May 2022
Representation in Malta