From 1 October 2026, Malta introduces important changes to the VAT treatment of gambling and betting services.
The main change is the narrowing of the previous VAT exemption. Gaming operators now need to assess each product separately based on:
- whether the activity remains exempt;
- where the player is located;
- whether the supply is B2C or B2B;
- which VAT place-of-supply rules apply.
Which gambling activities remain VAT-exempt?
The VAT exemption is retained mainly for:
- low-risk games;
- certain qualifying junket events;
- betting on real-life sporting events where the betting facility can only be accessed physically at the event venue.
Online betting on the same sporting event does not automatically qualify for the exemption.
VAT on Online Gambling in Malta
Many mainstream online gaming products are now treated as taxable services.
These include:
- automated online sports betting;
- RNG online casino;
- automated online poker;
- online bingo.
For B2C electronically supplied services, the place of supply is generally where the player resides.
This means that a Malta gaming company does not automatically charge 18% Malta VAT to all players.
If the player is located in Malta, 18% Malta VAT may apply.
If the player is located in another EU Member State, the VAT rules of that country generally apply, often through the EU One-Stop Shop (OSS).
What About Live Casino?
Live casino is treated separately from fully automated gaming products.
For B2C services, the place of supply generally depends on the customer’s location.
Gaming operators should therefore distinguish clearly between automated games and live dealer products when determining their VAT position.
VAT Treatment Simplified
| Gaming product | VAT treatment |
|---|---|
| Low-risk games | Generally exempt |
| Qualifying junket events | Generally exempt |
| Betting available only at a sporting venue | Generally exempt |
| Online sportsbook | Taxable under place-of-supply rules |
| RNG online casino | Taxable under place-of-supply rules |
| Online poker | Taxable under place-of-supply rules |
| Online bingo | Taxable under place-of-supply rules |
| Live casino | Separate place-of-supply analysis |
Input VAT Recovery
One potential benefit of the new regime is improved input VAT recovery.
Where gaming activities become taxable, operators may be able to recover VAT on expenses such as: software, technology, marketing, professional services, other operating costs.
Where a company carries out both taxable and exempt activities, partial exemption calculations may be required.
VAT Is Not Simply Charged on Player Deposits
The VAT taxable amount depends on the operator’s business model.
In some cases, the VAT base may be the rake or commission earned by the operator. In others, it may be based on gaming revenue after taking stakes and winnings into account.
Therefore, operators should not simply apply 18% VAT to all player deposits or total turnover.
B2B Gaming Services
B2B gaming suppliers should also review their VAT treatment.
Software, platforms, game supply and other B2B services are not automatically exempt simply because the customer operates in the gaming sector.
For cross-border B2B services, standard place-of-supply and reverse-charge rules will often apply.
VAT and Gaming Tax Are Separate
The new VAT rules do not replace Malta Gaming Tax.
From 1 October 2026, Malta is also introducing changes to the gaming tax framework, meaning that the same gaming activity may have obligations under both VAT and Gaming Tax rules.
What Should Malta Gaming Operators Review?
Gaming companies should review:
- each gaming product separately;
- player location rules;
- OSS registration requirements;
- input VAT recovery;
- partial exemption;
- invoicing and accounting systems;
- B2B contracts;
- whether prices are VAT-inclusive or VAT-exclusive.
From 1 October 2026, Malta is not introducing a flat 18% VAT across the entire gambling sector.
Instead, VAT treatment depends on the type of gaming service, the player’s location, the customer type and the applicable place-of-supply rules.
For international gaming operators, VAT should therefore be assessed by product and jurisdiction, rather than at company level only.
1st Step Solution can assist Malta gaming companies with VAT registration, OSS, accounting, tax compliance and corporate structuring.