9 financial reasons the movie industry chooses Malta as a filming destination.
Malta is blessed with clear blue waters, diverse terrains, baroque architecture, a warm climate, and a friendly Mediterranean lifestyle.
So it’s no surprise why box office hits like Troy, Gladiator, Assassin’s Creed, and The Promise with Christian Bale used locations in Malta as backdrops for their scenes.
While all of the above movies took advantage of Malta’s ideal shoot spots, investors also benefited from Malta’s attractive financial incentives. The benefits consist of tax rebates drawn by the Maltese government to attract the movie industry to the Islands. These are:
1. Non-Maltese residents employed with a production company or businesses that offer services to a production company are subject to a maximum VAT rate of 15% on income. This benefit is available if the period of employment does not exceed 183 days.
2. A maximum 10% final tax rate for non-resident actors, front of camera performers and film directors.
3. Expatriates who are employed or connected with the production and are in Malta for a short period are exempt from paying social security contributions.
4. VAT levied on services and goods in Malta is 18%. Reduced rates of 7%, 5%, and, 0% are levied in some cases such as in food and beverage.
5. Productions can claim 25% of their eligible expenditure at the end of the production. If the movie or TV series features Malta as Malta, an additional 2% can be claimed. A cultural test assesses the eligibility and percentage rebate that is granted to a production. This benefit applies to productions that are all or partially produced in Malta. Eligible expenditure includes accommodation, shipping, air travel, transport, and leasing of facilities.
6. Under the Malta Enterprise Act, productions can apply for investment aid in the form of tax credits.
7. If productions represent Malta directly, The Malta Tourism Authority offers financial assistance with Air Malta flights/cargo, hotel accommodation, transport costs of production vehicles, and location fees that are taxed by the government.
8. The Maltese Government has allocated a fund to encourage collaboration between Maltese and foreign companies to produce movies or series for international distribution. Funding is financed as a loan guarantee not exceeding €200,000.
9. Movies and script projects which promote Maltese: storytelling, stories, and cinema can benefit from the Malta Film Fund. Financing of up to €120,00 is available for production, development, and writers’ support.
Malta’s general tax policy is a useful platform from which to exploit productions and secure minimal tax exposure.