Deferral of compliance contribution and gaming taxes

Deloitte Malta tax alert

24 April 2020

Online gaming operators have been facing a number of challenges due to the current international climate in connection with the COVID-19 pandemic. In particular, the suspension, or cancellation, of several sporting events and other competitions, has impacted, and will continue to impact the revenue streams of licensees offering event betting on the outcome of such events.

The Malta Gaming Authority (‘MGA’) has been closely monitoring the situation and industry developments and has acknowledged the difficulties operators are facing. In line with the broader measures and tax deferrals which the Government of Malta has already announced, the MGA has announced the following measures:

  • The deferral of the payment of compliance contributions and gaming taxes owed to the MGA for revenue generated from activities classified as Type 21 in terms of the Gaming Licence Fees Regulations (S.L. 583.03) for the months of March, April and May 2020. Any such dues are to be deferred by three months.
  • For licensees that solely and exclusively offer Type 2 gaming services and for whom the payment of the fixed annual licence fee falls due in March, April or May, the payment of such licence fee shall also be deferred by three months.

The MGA have also highlighted that where activity generated from a gaming business has ceased entirely or dwindled to amounts that do not justify the continue operation of such operation, licensees may, in terms of the Gaming Authorisations Regulations (S.L. 583.05), voluntarily suspend their authorisation to operate that business operation due to the extenuating circumstances brought about by the current pandemic and can be reactivated again when the suspension of major sports leagues and events is lifted.

In addition, it was emphasised that licensees facing difficulties due to a sudden, acute liquidity shortage may wish to explore the possibility of accessing financing for their working capital requirements from their banks in line with the guarantees provided by the Malta Development Bank’s COVID-19 Guarantee Scheme.

1. Games of chance played against the house, the outcome of which is not generated randomly, but is determined by the result of an event or competition extraneous to a game of chance, and whereby the operator manages his or her own risk by managing the odds offered to the player.

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