Malta was the first EU member state to regulate the online gaming market in 2004 and has established a significant gaming hub with global relevance. Since 2004, the gaming industry in Malta has mushroomed and technological advancements have paved the way for new products. The majority of gaming companies based in Malta are made up of online casino type games and lotteries, followed by betting companies, P2P betting, poker networks and software providers. However, newer trends including fantasy sports and eSports are lately experiencing tremendous growth.
Both the land-based and online gaming segments are continuing to grow. Malta has awarded around 500 online gaming licenses – the highest number in Europe – that means many international gaming companies use Malta-based servers to operate services across the EU.
This comes as no surprise. A full participating member of the European Union and a full member of the EU single market, Malta understands and works to represent the interests of its gaming industry in the EU, whilst ensuring full transparency and cooperation with other European States to be internationally compliant. This provides safety and security for those opting to transfer or set up a new iGaming business in this jurisdiction.
Malta has a well-developed economy and its well-regulated politically stable environment works to accommodate e-gaming as a successful and growing industry. Innovative IT and support services infrastructures, strict and safe control operated by the Malta Gaming Authority (MGA) and rigorous consumer-focused gaming regulation make it straightforward to run a successful global business in Malta.
Malta also offers an attractive fiscal regime that supports established and start-up gaming companies by a favourable company tax regime and a wide array of double taxation treaties with numerous countries worldwide. The Island’s tax system is designed in such a way so as to encourage investment from foreign countries and new businesses.
Furthermore, a highly skilled, educated and multi-lingual workforce, and a comprehensive network of expert local financial service providers, further support the growth of the gaming industry and ensure remarkable economic development.
Figures speak for themselves. In a recent statement issued by the MGA, gaming in Malta has contributed more than €550m in terms of gross value added to the Maltese economy between January 2017 and June 2017 – this represents 12% of the total value added to the Maltese economy and an increase of 2% when compared with the same period in 2016. Moreover, the number of companies licensed in the Maltese jurisdiction stood at 282 in June 2017, growing by 6% from December 2016, reflecting continued investment in the sector; land-based gaming visits increased by 13.8% during the first half of 2017, spurred by growth in both land-based casinos and gaming parlours. Additionally, gaming tax revenue was registered at €28.6m in the first half of 2017, representing a 5.5% indirect tax intake of the Maltese Government.*
Based on the strength of these figures, 2018 is expected to be another year where growth will be the name of the game.
That’s not all – there are other changes on the horizon in 2018.
Under the new Value Added Tax Act, recently published in the Government Gazette, the Maltese government will no longer impose VAT on bets and wagers handled by local bookmakers, betting exchanges and “equivalent entities” starting 1 January 2018. Activities covered include betting on both real-life and virtual sports events, in addition to competitions, lotteries, performance of an index and also natural phenomenon.**
The Value Added Tax Act was enacted in order to keep up with the Council of Europe directive on the common system of VAT. In fact, according to the Council of Europe’s directive, an EU State may exempt betting, lotteries and other forms of gambling from VAT.
Once again, Malta proves to be one of the most advanced and respected online gaming jurisdictions for regulated online betting and gaming operations, offering exciting opportunities for new market entrants and established operators seeking a straightforward environment model.
Written by Marta Bellamoli, Marketing Co-ordinator
* The 2017 Interim Performance Report may be accessed from here
** The full regulation may be read here