Malta Unveils Package of Measures to Drive a More Productive, Higher-Value Economy

Malta is introducing a package of 10 measures aimed at making its economy more productive, more competitive and higher in added value, with the initiatives designed to work together as a single economic direction rather than as isolated steps. The package, announced by Economy Minister Silvio Schembri, spans support for small businesses, investment in technology and changes to the country’s institutional framework.

The headline measure is a tax cut for small businesses. From next year, companies with turnover of up to €1 million will pay a reduced rate of 25%, down from 35%, on profits retained in the business or reinvested. Schembri said most small firms put their earnings back into their operations, so rewarding reinvestment is the most direct way to help them become more competitive.

Technology features strongly. By the end of the year, a new scheme will offer a 60% tax credit on eligible investment in automation, artificial intelligence and digitalisation. Malta’s new national AI strategy to 2030, containing more than 80 concrete measures, will be launched next month. Investment in the digital sector will be strengthened to €100 million a year, with €120 million allocated for next year and a maximum benefit of €15 million per company, subject to conditions.

On the administrative side, six more entities, including Automated Revenue Management Services (ARMS), will be added to the Malta Business Wallet by the first quarter of next year to reduce red tape for businesses. A €2 million initial fund will support companies in the video games and entertainment sectors.

The institutional framework is also in line for changes. A bill will be presented in Parliament in the coming days to strengthen the operational framework of Malta Enterprise and Indis Malta, while a call has been issued to draw up Malta’s first industrial policy. Schembri also referred to an initiative on land reclamation and related studies.

Summing up, Schembri said the message is clear: Malta will have an economy that continues to grow, “but grows better.”