Malta Takes on Brussels Over EU Gambling Tax as Politico Says the Island Is Defending “Big Gambling”
Malta’s determination to protect its online gambling industry has once again attracted international attention, this time in Politico, which reports that the country is leading opposition to an attempt to introduce an EU-wide levy on online gambling.
The headline could hardly be stronger: “Malta leads fight against EU bid to tax Big Gambling.”
The article has also prompted criticism abroad. Irish commentator John O’Brennan, sharing the Politico report, accused Malta of having “turned into one big casino” and claimed that the gambling industry had effectively “captured an EU member state”.
Such language is clearly polemical. Nevertheless, behind it lies a genuine and increasingly important dispute between Malta and those within the European institutions who want online gambling to contribute directly towards the financing of the EU budget.
The proposal emerged in discussions over new sources of revenue for the European Union’s next long-term budget, covering the period 2028–2034. In May, the European Parliament formally listed an online gambling levy among the alternative sources of revenue that could be considered. The Parliament is looking for additional “own resources” as the EU attempts to finance an increasingly expensive range of commitments without relying exclusively on contributions from national governments.
Supporters of the gambling levy argue that online betting has become an enormous cross-border digital industry and should therefore make a direct contribution to European finances. One of the politicians associated with the proposal, European Parliament Vice-President Victor Negrescu, has suggested that such a levy could potentially generate between €2 billion and €4 billion annually. At present, however, no definitive rate or precise method of calculating such a tax has been agreed.
Malta threatens to use its veto
For Malta, this is not a marginal issue.
Prime Minister Robert Abela has already made it clear that Malta is prepared to oppose the measure at the highest level. According to reports on the negotiations, Abela has said that Malta would veto the EU’s next budget if an EU-wide gambling levy formed part of the package.
The Maltese opposition has adopted essentially the same position.
Nationalist MEP David Casa declared in May that a future PN government would veto such a tax “without hesitation”. Casa argued that an additional European levy would punish EU-regulated operators while encouraging companies to relocate outside the Union and potentially driving customers towards unregulated gambling websites.
This means that, unusually, the Maltese Labour government and the Nationalist opposition appear broadly united on the issue.
There is also a powerful legal weapon at Malta’s disposal. Changes to the EU’s system of “own resources” require unanimity in the Council and must subsequently be approved by the member states according to their respective constitutional procedures. Malta therefore possesses considerably more leverage on this question than its small population might suggest.
Why Malta is fighting so hard
The explanation is economic.
Over the past two decades, Malta has deliberately built itself into one of Europe’s principal centres for online betting and casino operations. Hundreds of companies operate from the islands or hold licences issued by the Malta Gaming Authority.
The sector has generated high-value employment, office development, professional services and substantial tax revenues. It has also attracted thousands of foreign workers to Malta.
That explains why successive Maltese governments have treated the competitiveness of the gaming sector as an economic priority rather than simply as a regulatory matter.
Indeed, Malta is currently reforming its own taxation of the gaming industry. From 1 October 2026, changes to both VAT and gaming taxation will come into force. The scope of Malta’s VAT exemption for gambling is being narrowed, meaning that a broader range of gambling services will become taxable.
The government itself describes these reforms as intended to provide greater certainty while safeguarding Malta’s competitiveness and attractiveness as a gaming jurisdiction.
This is therefore not quite the picture suggested by those claiming that Malta simply refuses to tax gambling. The real argument concerns who should levy the tax and at what level.
Malta accepts national taxation of the sector. What it strongly opposes is the creation of an additional tax imposed at EU level.
But Malta is coming under increasing pressure
There is nevertheless a wider issue that makes the Politico story particularly significant.
Malta’s gaming model is facing challenges from several directions simultaneously.
The European gambling market has changed considerably since Malta established itself as one of the first major online-gaming jurisdictions in the EU. Increasingly, individual member states insist that companies targeting their residents comply with their own national gambling laws and licensing systems.
The Court of Justice of the European Union has repeatedly made clear that there is no general EU “passport” under which a Maltese gambling licence automatically permits an operator to offer gambling throughout the Union.
Indeed, in a separate case involving Malta’s controversial Article 56A, formerly known as Bill 55, an Advocate General of the European Court recently rejected the idea that Malta can automatically shield Maltese-licensed gambling companies from judgments issued in other EU member states. The Advocate General emphasised that member states remain entitled to apply their own gambling laws to operators providing services to residents within their territory.
That dispute concerns a different issue from the proposed EU gambling levy, but together they illustrate the growing tension between Malta’s gaming model and moves elsewhere in Europe towards stronger national or European control.
“Malta has turned into one big casino”
It is against this background that John O’Brennan’s reaction to the Politico article should be understood.
He wrote:
“Malta has turned into one big casino + is now actively opposing EU plans to impose a levy on online gambling firms, a huge number of which are based in Malta.”
He then described gambling as an “appalling industry” and claimed it appeared to have “captured an EU member state”.
The accusation of “capture” is serious and ultimately an interpretation rather than a fact. Malta can reasonably argue that it is simply defending an industry that contributes substantially to its economy, just as other EU states defend economic sectors of strategic importance to them.
France protects agriculture. Germany has historically defended its automotive industry. Ireland has strongly defended aspects of its corporate taxation model. Malta is now defending online gaming.
Yet the Politico coverage shows that this defence is acquiring a reputational cost.
To Malta, the issue may be about protecting employment, investment and national taxation powers.
To critics outside Malta, however, the same policy is increasingly being presented as a small EU state using its veto to protect multinational gambling companies.
A battle bigger than gambling
This is perhaps the most important aspect of the story.
The dispute is ultimately about much more than casinos and online betting.
It concerns the gradual attempt by Brussels and the European Parliament to acquire additional sources of taxation that are independent of national contributions.
For Malta, accepting an EU gambling levy could therefore establish a precedent extending well beyond the gaming industry.
And because changes to EU own resources require unanimity, Malta has the legal capacity to resist.
The question is whether it can maintain that resistance as pressure from larger member states and the European Parliament increases.
Politico’s decision to frame Malta as the country “leading the fight” against taxing “Big Gambling” suggests that what was previously largely a Maltese economic policy issue has now become part of a much wider European political battle.
And Malta finds itself directly at its centre.