Malta’s single 5% gaming tax is about to disappear. From 1st October 2026, Type 1 gaming services are taxed at 15% and Types 2, 3 and 4 at 10%, under Legal Notices 84 and 86 of 2026, published in the Government Gazette on 1st April.
Read the headline and it looks like the tax tripled. Read the regulations and a different picture emerges, because of who the new rates actually apply to and what the accompanying VAT change gives back. Anyone weighing whether to set up a company in Malta for a gaming operation should understand both halves before drawing conclusions.
Key Takeaways
- The new rates apply only to Malta-based players. Gaming tax turns on whether the player is established, permanently addressed or habitually resident in Malta. International operations stay outside the scope, so for most operators the affected slice of revenue is small.
- The VAT reform cuts the other way. Narrowing the gambling exemption moves many previously exempt activities into taxable supplies, which opens input VAT recovery on costs that were previously unrecoverable.
- The company and the licence are two separate projects. Incorporation takes days and must happen first. The MGA licence runs six to nine months, with verticals approved individually.
Why Malta Still Anchors European iGaming?
Malta became the first EU member state to license remote gambling, and the framework it built in the early 2000s drew operators to the island in waves. That head start turned into infrastructure. Hosting, payments, platform providers, compliance specialists and a labour market that understands the sector all sit within a few square kilometres.
The legal foundation was rebuilt in 2018. The Gaming Act, Chapter 583, consolidated a fragmented set of rules into a single technology-neutral statute, introduced the B2C and B2B split, defined four game types, created the compliance contribution model and extended licence terms. The Malta Gaming Authority regulates the sector, anti-money laundering supervision sits with the Financial Intelligence Analysis Unit, and applications are filed through the MGA Licensee Portal.
The practical value of an MGA licence is not the tax rate. It is that banks, payment processors and software partners recognise it, which is a different problem from the one an offshore licence solves.
How the Licensing Framework Works?
B2C and B2B
Malta runs a two-tier model. A B2C Gaming Service Licence covers operators offering games directly to players. A B2B Critical Gaming Supply Licence covers suppliers of gaming platforms, software or critical services to MGA-licensed operators, or to operators licensed in other well-regulated EU and EEA jurisdictions.
Since the 2018 reform, a single licence can cover several game types, so there is no need to hold a separate licence for each class of game.
One distinction matters more than it first appears. B2B licensees are exempt from the compliance contribution and fall outside the scope of gaming tax entirely, because they hold no Malta-player gaming revenue. The reform taking effect in October therefore leaves the B2B position untouched.
The Four Game Types
- Type 1. Games of chance played against the house, based on a random number generator, covering casino games, slots, lotteries and virtual sports.
- Type 2. Fixed-odds betting.
- Type 3. Peer-to-peer games where the operator takes a commission rather than a position, such as poker, bingo and betting exchanges.
- Type 4. Controlled skill games, including fantasy sports.
What It Costs to Hold a Licence?
Three separate charges apply, and they are frequently confused with one another.
The application fee is €5,000 and is non-refundable, for both B2C and B2B routes.
The annual licence fee is fixed. For a standard B2C Gaming Service Licence it is €25,000, or €10,000 where the licence covers Type 4 only. B2B annual fees run between €25,000 and €35,000 depending on revenue, with lower fees for certain software-only suppliers.
The compliance contribution is variable and scales with gaming revenue, under the Gaming Licence Fees Regulations. Minimum and maximum annual amounts apply by type: €15,000 to €375,000 for Type 1, €25,000 to €600,000 for Type 2, €25,000 to €500,000 for Type 3, and €5,000 to €500,000 for Type 4. A minimum is payable monthly depending on the approved services and revenue during the licence period.
Key persons are charged at €50 per person per role.
The 1 October 2026 Reform
The Gaming Tax (Amendment) Regulations 2026 restructure the framework rather than simply raising a number. The MGA and the Malta Tax and Customs Administration have presented the change as part of a commitment to the sector’s long-term sustainability and regulatory certainty, announced in the 2026 Budget.
The New Gaming Tax Rates
The separate 5% gaming tax and the tiered device levy, which ran from 12.5% to 30%, merge into a single regime. From 1 October 2026:
- 15% of aggregate gaming revenue for Type 1 gaming services
- 10% of aggregate gaming revenue for Type 2, Type 3 and Type 4 gaming services
- 5% where the qualifying activity is generated within controlled gaming premises, or where it is lawfully classified as a junket or junket event
The device-based levy is abolished. The Studio Broadcasting Levy rises from €500 to €3,000. Payment and setoff rules are adjusted, the MGA’s power to grant reliefs is revised, and the definition of a qualifying activity is realigned with the licensing requirements under the Gaming Authorisations Regulations.
Who Actually Pays More
This is where the headline breaks down.
Gaming tax has always applied to revenue from players in Malta, and the reform sharpens rather than widens that test. For remote gaming, taxability turns on whether the player is established in Malta, has a permanent address in Malta, or habitually resides in Malta, rather than on physical presence at the moment of play. The residence-based test is maintained and reinforced.
The consequence is straightforward. Changes apply only to supplies consumed in Malta. International operations remain out of scope. An operator licensed in Malta but serving players across Europe, Latin America or Asia sees the new rate applied to whatever fraction of its revenue comes from Maltese residents, which for most licensees is a rounding error rather than a business case.
Where it does bite is on operators genuinely focused on the Maltese domestic market, and on land-based and controlled premises operations, which the reform brings onto a unified footing with online.
The VAT Change That Cuts the Other Way
Legal Notice 86 of 2026 amends the Fifth Schedule to the VAT Act, and it moves in the opposite direction to the tax increase.
From the same date, the VAT exemption for gambling and betting is reduced in scope. The exemption narrows to betting, lotteries and other forms of gambling as approved by the Minister, which places many online products inside the VAT net. Activities previously treated as exempt without credit become taxable supplies.
At first reading that sounds like a second increase. In practice it is the opposite for many operators, because an operator moving from exempt supplies to taxable supplies gains the right to recover input VAT on its costs, which was previously unrecoverable. Platform fees, marketing, professional services and technology spend all sit in that category.
Whether the net effect is positive depends on your cost base and where your players are. It is a modelling exercise rather than a headline, and it should be done before October rather than discovered in the first return afterwards.
Company First, Licence Second
Two projects run here, and confusing them is the most common planning error.
The company comes first. Applicants must establish a Maltese legal entity with a registered office before applying for the licence. That entity is an ordinary private limited company, with minimum authorised share capital of €1,164.69 of which 20% is paid up, one shareholder, one director and a company secretary. Registration at the Malta Business Registry is normally issued within a few business days of a complete file.
The licence is a separate track and a longer one. Applications go through the MGA Licensee Portal, and the process typically runs six to nine months. Verticals are approved individually, so a casino, a sportsbook and live dealer are not granted in a single stroke, which is a meaningful difference from the single-licence offshore regimes.
Additional share capital requirements apply to the licence holder depending on the type of licence and the services covered, and these sit above the ordinary company law minimum.
What the MGA Expects Before It Says Yes?
The application is a substantive review of the business, not a registration formality. The Authority assesses:
- A detailed business plan, including markets, products and financial projections
- Key persons, their roles and their fitness and propriety, each carrying its own fee
- Issued and paid-up capital appropriate to the licence type
- Anti-money laundering and know-your-customer frameworks, with FIAU supervision applying on an ongoing basis
- Responsible gaming policies and player protection measures
- Technical systems, hosting arrangements and control systems
Ongoing obligations continue after grant, including compliance reporting, regulator visits and the enforcement regime the MGA has strengthened since 2023.
Who Malta Fits, and Who It Does Not?
Malta suits established operators with the capital and the compliance capacity to carry the process. It suits B2B suppliers particularly well, given the exemption from compliance contribution and gaming tax. And it suits operators moving from an offshore licence into a regulated market, where the licence itself unlocks banking and payment relationships that were previously closed.
It is a poor fit for an undercapitalised startup looking for the cheapest route to market. The application process and the ongoing compliance burden are materially heavier than offshore alternatives, and the fixed costs arrive whether or not revenue does.
If you are weighing it, the sequence matters. Incorporate the entity, then run the licence application with the timeline it actually needs. We handle the company formation, the tax and VAT registrations and the ongoing corporate compliance. The MGA application is a separate regulatory track, and we will tell you plainly where our part ends and the licensing work begins.
Tell us what you plan to offer and which markets you are targeting, and we will set out what the corporate side requires.