Last Friday, I was enjoying the 35-degree Maltese heat with my Chief Executive, Robert Bartlett, and 200 other guests who were gathered to celebrate the opening of Chesterton Humberts’ latest international office: Chestertons Malta.
The new office is lead by Christopher Pace, a Maltese native and a man who has built a solid reputation in the financial services and property sectors over 25 years.
CEO Robert Bartlett and Christopher Pace
Already with international offices across Europe, the Middle East, Australia and South Africa, a new office in Malta may seem like a slightly odd choice for Chesterton Humberts, but the island has transformed itself in recent years and is now being seen as an increasingly attractive place to invest.
In fact, Malta is now often spoken about in the same breath as other tax-efficient havens such as Gibraltar (where, incidentally, we also have an office!), and this is all thanks to the country’s tax regime which has been carefully designed by the island’s economic strategists to attract a certain type of resident.
As Fred Redwood notes in the latest edition of our 1805 magazine, just like the other EU countries, Malta is seeking a safe economic passage through the current downturn. Unlike many of its competitors, however, it has a very clear idea of how it will manage this: Malta wants seriously wealthy people to buy property on the island.
The logic is simple: high earners spend heavily, thereby providing employment and wealth for all. Many of the high-fliers the government is targeting will come from new industries such as financial services, gaming and information technology, but actors and footballers would also fit the bill (it has been rumoured that Tom Cruise and David Beckham are considering buying on the island).
And it’s easy to see why some top-tier earners would be very tempted by some of the new legislation being passed: the Highly Qualified Persons Rules came into play last May, meaning that incomers in executive positions in financial services pay tax at only 15%, provided their income amounts to €75,000 a year for five consecutive years. Beyond €5 million a year the excess is exempt from tax. Then, on top of this came the New High Net Worth Individuals Scheme in September. This scheme means that residents only pay 15% tax, provided they buy a home in Malta worth at least €400,000 and reside on the island for a minimum of 90 days a year. The minimum tax payable is €20,000 a year.
A British colony for over 200 years, Malta has always been a popular destination, especially amongst the British, and has many of the cultural and legal characteristics that investors and holiday home owners find comforting. But it also has the added advantage of being seen as the European gateway to the Middle East and North Africa and many residents will leave their families to live safely on Malta while they go off to work in countries such as Libya, which is just a 40-minute flight away.
Speaking to Chris at the launch party, he talked about how he had witnessed a small revolution taking place in the Malta property market over the past few years and this is what had encouraged him to open the office with Chestertons.
There are not many people who know this island better than Christopher and his excellent team. Everyone in the International department is looking forward to working with our new colleagues to make Malta one of our 2012/13 success stories.
Christopher Pace, Brian Flemming & Andrew Hawkins