Sooner than later, bettors can relish VAT free betting in Malta! The Maltese government confirms that on the 1st of January 2018, all types of betting will be exempted from VAT. What are the consequences of this policy? Let’s find out.
The decision to implement VAT free betting in Malta stems from the European States Council VAT Directive. It’s not only Malta, but nearly 30 EU countries plan to exempt VAT on gambling. According to online gambling news in Malta, what each state considers as forms of gambling will differ. We will specifically look at the Maltese case.
The New Maltese VAT Act
Based on the new Maltese VAT Act, customers won’t have to pay VAT with bets placed on sporting events, daily fantasy sports, competitions, real and virtual events as well as betting services. Additionally, both offline and online lottery in Malta are also exempted from VAT payment.
There’s a catch though. VAT free betting in Malta does not apply to online gambling sites and casinos. Sadly, players of blackjack, poker, roulette and slot machines still have to pay a whopping 18% VAT.
What’s Great for Us?
For us, VAT free betting in Malta means that there won’t be extra deductions. Normally, some of our money has to be deducted to pay for the VAT. With this new policy, we can place bets with our money to its full amounts.
It certainly is a fairer judgment. Betting is not like purchases or services. What the bettors get in return is winning or losing. So because of the nature of this industry, it doesn’t make sense to tax customers on all of their deposits.
Why the Government Agrees with VAT Free Betting in Malta
Yes, it’s true that VAT free betting in Malta could decrease the government’s income by 700 million Euros. However, it is only 7.3% of the total GDP which amounts to over 10 billion Euros. The Maltese can afford to lose this amount of money.
Why is that so? With the VAT exemption, people will definitely bet more. It’s great news for both offline and online sportsbook in Malta because it will generate more revenue. Considering this, Malta is even more appealing to new and existing bookmakers.
In 2017, 12% of the economy comes from the gaming industry. By having VAT free betting in Malta along with already low tax rates, this number could increase by up to 50%. We can safely assume that the loss in VAT income is worth it for the economic growth.