Italian traders who are afraid of the incoming Tobin Tax, or FTT as it is also known, are fleeing to Malta where they know they will not be affected by the tax, reported Livia Zancaneri on the prestigious Italian financial daily Il Sole 24 Ore.

Biagio Milano, an independent trader, among the founders of Ifmadvisor, an association of independent operators and consultants who fought against the adoption by Italy of the tax, told the paper that some months ago he had asked for a Maltese residence permit and went to live in Attard.

He is setting up a company, which will become operational in September, together with another professional person and a well-known website which deals with financial matters and together will offer advice on markets.

The company will be housed in Malta but the owners are still discussing whether it will be under Maltese legislation, or English or that of Luxembourg.

There are two reasons why Italian traders are fleeing the Tobin Tax and leaving Italy: the future introduction of a European FTT especially if the principle of residence is applied (and in the case of Italians, since there is the Tobin Tax in Italy, one would have to pay taxes on every financial instrument, even if for instance this is British) and the excessive taxation that there is in Italy.

“There are many people who follow our advice on how to invest in markets: before we began our activities we made a questionnaire to understand better what our clients require and 570 replied. Most of these said they had lost their jobs and for them trading is the only revenue they have. The Tobin Tax would penalise them, excessively,” Mr Milano said.

Malta is not a fiscal paradise, they insist at the Maltese Chamber of Commerce. Profits from Maltese companies are subject to a 35% tax but, in case of distribution of dividends, shareholders can ask for a refund up to 6/7 of the total tax. It is also easy to obtain residence permits in Malta: one has to show that one is self-sufficient financially, is employed by a company and has opened a deposit or an activity.

Ms Zancaneri however reports that the Maltese are growing worried by the excessive presence of foreigners. “There is an exodus but the Maltese system is not prepared for this and risks collapsing,” people say in Malta.

At present there are about 2,000 Italians of a total population of 415,000.