On 11th August 2025, Malta quietly adopted Bill 142, a piece of legislation that fundamentally rewires how the Maltese State treats tax crime and everything that flows from it.

The law does not decriminalise tax evasion on paper. Instead, it introduces a “special mechanism for out-of-court settlements” that allows tax evaders to resolve fiscal breaches without criminal prosecution.

Crucially, the mechanism does not stop at tax offences. It extends to so-called “connected breaches” – meaning crimes committed alongside tax evasion, including money laundering, fraud and conspiracy.

In practice, this means that individuals accused of multiple financial crimes can resolve all of them through administrative settlement, avoiding criminal prosecution entirely.

“This bill is going to ruin the country,” a tax consultant told Amphora Media. 

The mechanism is already being implemented.  In reply to a series of parliamentary questions by MP Adrian Delia, Finance Minister Clyde Caruana confirmed that the Malta Tax and Customs Administration (MTCA) has received several applications under the new law and is currently processing them. 

Caruana did not say whether any fines or sanctions have yet been imposed. He also declined to provide figures on the number of individuals or companies involved, the size of those companies, or the types of businesses concerned, referring the questions to the relevant minister. 

Malta already has a significant problem with uncollected taxes. Official figures show that as of 2024, Malta has accumulated over €8 billion in uncollected tax, €6.1 billion in VAT and €2 billion in other taxes.  The government has written off over €6.6 billion of that figure.

Meanwhile, the FATF had expressly noted how Malta’s ability to fight tax evasion was one of the reasons the country was placed on the grey list to begin with – and was one of the three requirements to get off it. 

Amphora Media has sent questions to MTCA Commissioner Joseph Caruana for further clarification on the figures.

Under the Bill 142 mechanism, available under certain conditions, taxpayers or companies who reach a settlement with the tax authorities may have their criminal liability for certain tax breaches extinguished after paying outstanding dues and an additional penalty ranging from €10,000 to €1,000,000.  

In return, settlement agreements will constitute an “executive title” allowing direct enforcement, while resolving and terminating related court proceedings. 

Under the settlement mechanism, once the taxpayer pays the agreed amounts, all criminal liability for the covered breaches and related connected breaches is extinguished, and any ongoing prosecutions are effectively terminated.

The changes apply to all forms of tax: Income Tax, VAT, Social Security, and Duties.

The Act also explicitly allows the Commissioner to recognise agreements entered into before the law came into force.

Connected Breaches: The Law Extends Beyond Tax Crime To Other Serious Offences

Crucially, the mechanism covers all breaches of tax laws and all “connected breaches”, that is, any criminal offences committed while breaching tax laws. 

The Act defines “connected breaches” and covers offences committed to facilitate, conceal, or profit from tax crimes, including acts forming part of a pre-concerted plan or involving the use of criminal proceeds. 

For example, a person who commits money laundering and fraud in pursuit of a tax crime can avoid criminal prosecution for all three charges. It would even extend to conspiracy and other serious crimes.

This is despite a national strategy (2021-2023) promising that “The legislative AML/CFT/CPF framework will be constantly updated to ensure adherence with international (FATF and European) standards, as well as other best practices worldwide”.

The law contains a narrow exclusion, providing that “connected breaches” do not include offences listed under Subtitle IV of Title III of the Criminal Code. 

These include offences relating to abuse of public authority, unlawful exaction, extortion and bribery, abuses committed by advocates and legal procurators, malversation by public officers and servants, prison-related abuses, refusal of a lawfully due service, and breaches of duties associated with public office.

Offences typically associated with tax evasion, fraud, and financial misconduct remain eligible for settlement.

Under the new mechanism, limitation periods for both tax offences and connected crimes are suspended while settlement negotiations are ongoing. During this period, no prosecution may be initiated.

Under articles 187A and 187B, the amendments do criminalise breaches of government settlement agreements, with potential imprisonment and further fines (limited to €2.5 million and €500,000, respectively).

However, more consequentially, article 187C stipulates that these offences can only be prosecuted following a complaint by the Commissioner.

Bill 142: A major tax reform rushed through parliament in 12 days

In its official “Objects and Reasons”, the government framed Bill 142 as a measure designed to strengthen investigative powers, improve tax recovery, and deter financial crime.

It claimed the new settlement mechanism would impose penalties comparable to those applicable in criminal proceedings, while enhancing the state’s ability to collect outstanding dues.

The law moved through Parliament in 12 days. Its first reading was held on 23 July 2025, and on 4th August, it passed its second reading, committee stage, third reading and final vote in a single day. All 38 government MPs supported the bill, while 28 members voted against it.

Bill 142 was tabled in Parliament on the same day as Bills 143 and 144, two parts of a controversial planning reform package that has since dominated public discourse and sparked protests. While those bills remain at the first reading stage, Bill 142 was approved and assented into law by 11th August.

Bill 142 implications: The lawyer, the VAT carousel, and the tax advisors

The law is already leaving its mark.

In September 2025, lawyer Aron Mifsud Bonnici informed the courts that he would be exploring the legal amendments enacted under Bill 142 in his case, in which he stands accused of money laundering, tax evasion, and making false declarations in documents prepared for the Malta Tax and Customs Administration (MTCA).

More than €1.6 million of Mifsud Bonnici’s assets were frozen in a court order as part of the case on 23rd July 2025.

According to a Times of Malta investigation, the probe into Mifsud Bonnici began following a series of large transfers worth €1.4 million to XNT Limited, a Malta-based investment firm.

Financial documents reviewed by Times of Malta indicated that Mifsud Bonnici received over €2.4 million in payments into his personal bank accounts between 2016 and 2019. However, during those same four years, Mifsud Bonnici declared a total income of €680,000.

Mifsud Bonnici is an associate of former minister Konrad Mizzi and is separately facing criminal charges related to the Vitals Hospital case. 

He served as a legal advisor in former Prime Minister Joseph Muscat’s government; as an advisor in the Ministry for Energy under Konrad Mizzi, where he participated in discussions on the Montenegro Wind Farm Project; as the board secretary at Enemalta; and as a member of the Grievances Board at Transport Malta.

A separate Times of Malta investigation also revealed how Aron Mifsud Bonnici and Robert Borg raked in over half a million euros in “dividends” and “directors’ fees” from two companies involved in the publicly funded community work scheme.

The law could also have significant implications for a major tax fraud investigation involving a VAT carousel. 

In 2023, it was reported that Martin Farrugia and Henriette Cassar were accused of defrauding the VAT system, allegedly to the tune of around €62 million.

The investigation, known as Operation Panthera, reportedly covers the period 2012–2019 and encompasses companies linked to the contractor (including NCCF, MAM Construction Ltd, and MWF Construction Ltd), which are said to have under-declared substantial sales and VAT payable.

The pair have pleaded not guilty, and the case is ongoing. Amphora Media has been informed that the police are aware of businesses involved in the scheme, but all have so far evaded prosecution. 

In December 2025, Farrugia was approved a variation to his freezing order to transfer four leopards and four pumas to the Pafos Zoo in Cyprus.

Amphora Media has reached out to the police over the issue, but they have not responded.

Another case impacted by the legislation involves Nigel Scerri and his wife, Mikaela, the owners of a tax advisory and accountancy firm. The pair have been charged with money laundering, tax evasion, fraud, and other crimes, and are subject to a €15 million asset freeze.

Malta’s High-Risk Industries

A 2023 National Risk Assessment (NRA) on money laundering, referenced in the Parliament in February 2026, revealed that several key sectors remain vulnerable to financial crime despite enhanced regulatory controls.

It evaluated industries in the Financial Sector, Designated Non-Financial Businesses and Professions (DNFBPs), and Virtual Financial Asset Service Providers (VFASPs) based on three factors: 

• Inherent risk: how vulnerable the sector is by nature,
• Effectiveness of mitigating measures: how strong the controls and supervision are,
• Residual risk level: the remaining risk after controls are applied.

Most sectors fell within the medium-to-medium-high residual risk range. Strong controls (rated “High” or “Substantial”) reduce risk in many areas. However, in several industries, the risk level means they still require close monitoring, and some sectors remain vulnerable to money laundering and financial abuse.

Financial Institutions, Recognition Notice Framework, Corporate Service Providers (CSPs), Real Estate (Immovable Property), High-Value Goods Dealers, and Tax Advisors also fell under the medium-high risk residual risk category.

The Finance Ministry, MTCA, the Attorney General’s Office, Aron Mifsud Bonnici, Martin Farrugia, and Henriette Cassar did not respond for request for comment.

• Malta issued over 326,000 single permits between 2015 and 2024.
• Nearly all single permit holders in Malta arrive for 12 months or more.
• The share of EU citizens among immigrants (for any reason) has shrunk during the post-pandemic recovery.
• In 2015, the share of employees and people applying for other reasons (including retirement) was about equal. By 2024, employment overshadowed the ‘other’ category.

Malta’s population has grown by over 100,000 in a decade. Behind the headline figures lies a deeper transformation; the country’s migration system is shifting away from residents and retirees attracted by favourable tax rates and weather towards large-scale import of non-EU labour.

An Amphora Media analysis of Eurostat data shows that, over the past ten years, Malta has rebuilt its migration model around non-EU workers recruited at scale to sustain rapid economic growth.

In 2015, employment-based migration stood on roughly equal footing with other forms of residence, a category that includes self-funded retirement. By 2024, employment had become the overwhelmingly dominant route into the country for third-country nationals, while self-funded retirement, coupled with other minor pathways, have lost their prominence.

EU countries like Malta can issue residence permits for various types of stay, including permits covered by EU law. A single permit combines a residence and a work permit, allowing its holder a brief period of unemployment as well, without losing their residence. It is the most common employment residence permit, but there are others.

Malta issued over 326,000 single permits between 2015 and 2024. Their number ballooned 11 times over the period, reaching 67,392, up from 5,970 issued in 2015.

Even during the pandemic, the number of such permits dipped very slightly, and peaked in 2023 at just over 70 thousand. The numbers include renewed permits.

Unlike countries like Lithuania or Portugal, Malta is not actively using this system for short-term, seasonal work. Nearly 9 in 10 single permit holders in Malta are there longer-term – for 12 months or more.

The number of longer-term permit holders has been soaring since 2018, consistent with the government’s policy changes that have made the recruitment of non-EU nationals easier since 2017.

Source: Eurostat

Immigration data shows how non-EU citizens overtook EU citizens. The share of EU citizens among immigrants (for any reason) further shrank during the post-pandemic recovery.

Source: Eurostat. Note: EU countries include the UK until 2020

From 2021, UK citizens need a work permit in Malta. After a post-pandemic growth, their number has been declining, with 203 new British workers in 2024.

By 2024, employment had become the main gateway into Malta for non-EU nationals, accounting for half of all new arrivals, with education representing a further quarter. 

The figures below break down residence permits by purpose.

Employment

Over 119,200 first residence permits for employment purposes were issued between 2015 and 2024. This is not the same as the number of workers, as some may have left or changed their residence status.

Indian nationals received the most permits, a fifth of the total issued, followed by Nepalese, Filipino, Serbian and Colombian citizens.

Several of these nationalities are also among Malta’s most deported.

In 2024, the number of first permits was as follows.

Source: Eurostat

Top nationalities in 2015-2024

Source: Eurostat

Highly qualified individuals can obtain an EU Blue Card and reside in Malta with it. 

Between 2015 and 2024, Malta issued only 27 new permits on this basis: Russians, Americans and Indians received three cards each.

Education

Between 2015 and 2024, a total of 40,180 residence permits were issued for educational purposes, with Indians (7,898 permits) and Colombians (7,239 permits) topping the list. 

In 2015-2016, only a handful of Indians came to study in Malta, but the number shot up to hundreds in 2017 and nearly tripled between 2022 and 2023.

Hundreds of Colombians had been coming to study in Malta already in 2015-2016, but new arrivals first exceeded 1,000 in 2022.

Top nationalities of residence permit recipients for education

Source: Eurostat

Family

Residence for family reasons is a separate status. The number of such first permits peaked in 2023 at over 3,000. Between 2015 and 2024, the main nationalities receiving these permits were as follows.

Main nationalities of permit recipients residing for family reasons

Source: Eurostat

Most new recipients of family permits joined another non-EU citizen already living in Malta. There were almost 2,600 in 2024, with 537 non-EU citizens joining an EU citizen living in Malta (the most common nationality among these is British).

Other reasons

Residence permits can also be issued for other reasons, which include financially independent retired persons, non-asylum discretionary permissions to stay, and diplomats. Eurostat also collects data on residents with international protection statuses (refugee status and subsidiary protection).

In Greece and Italy, over half of first-time resident permit holders in 2024 applied for one of these reasons, but in Malta, the share was under 16%. 

In 2015, the share of employees and people applying for other reasons (including retirement) was about equal, but employment has since overshadowed this other category.

Source: Eurostat. Note: the drop in employment-based residence permits likely reflects changes in the Temporary Work Agencies legislation.

In 2020, when Brexit changed the status of UK citizens, making them third-country nationals, it was estimated that around 8,000 retired Brits were living in Malta. 

The number of first permits for other reasons (including retirement) has recovered after a pandemic dip and soared in 2023 and 2024, reaching nearly 4,700.

In 2024, 4,073 residence permits were issued by Identita through the Malta Permanent Residence Programme (MPRP), the Malta Residency and Visa Programme (MRVP), and the Nomad scheme for digital nomads (the latter accounted for 1,031 of this number).

Eurostat data also contains statistics on ‘residence’ as a reason. China and Russia top the list of over 11,400 recipients between 2015 and 2024.

Top nationalities with ‘residence’ as a reason for permit

Source: Eurostat

Meanwhile, a total of 5,242 people received refugee status or subsidiary protection between 2015 and 2024, with the top nationalities being Syria and Libya. Contrary to leading politicians’ claims, the contribution of asylum seekers and refugees to Malta’s rapid population growth is minimal.

Asylum applications in Malta have been in steep decline, with the government praising this trend amid increased deportations. In 2025, Amphora Media reported on pushbacks to Libya to decrease arrivals.

In totality, this significant shift in migration policy, geared towards imported labour from non-EU countries, is reshaping towns and neighbourhoods as explored in Amphora Media’s Landscapes of Change investigation.

A recent ruling by the Court of Justice of the European Union strengthened players’ ability to recover online gambling losses across borders under their home laws, but stopped short of directly challenging Malta’s controversial legal protections for the iGaming industry under a legal amendment known as Bill 55.

“Online games of chance: a player may, as a general rule, rely on the law of his or her country of residence when bringing an action to establish liability in tort or delict on the part of the directors of a foreign provider that does not hold the required licence,” the court’s statement reads.

The judgment confirms that, as a general rule, players may rely on the law of their country of residence when bringing non-contractual claims linked to online gambling, even where the operator is established and licensed in another EU member state, such as Malta. 

But, more crucially, it does not touch Malta’s legal framework, notably Bill 55, which can shield gambling companies from enforcing foreign courts’ judgements. 

“The Court did not examine, question, or assess the validity of Malta’s regulatory framework,” Malta Gaming Authority’s spokesperson told Amphora Media.

Commenting on Amphora’s earlier findings about the way Malta’s laws protect gambling operators, lawyer Benedikt Quarch, who has represented numerous German and Austrian gamblers, has earlier explained to Amphora Media that his firm would bring “thousands of cases to Malta” once the EU courts declared the bill void.

What the Court decided: The case involving an operator in Malta

The EU court case began with an Austrian client who used a Maltese operator, Titanium Brace Marketing, which did not hold the licence required under Austrian law. 

According to the judgement, the Austrian player accumulated losses between November 2019 and April 2020.

The player decided to bring a case against the operator’s two directors before the Austrian courts, arguing that they are “jointly and severally liable for the fact that Titanium offered illegal games of chance in Austria”. The directors argued that not Austrian but Maltese law should apply.

The directors also argued that they should not be liable for the company’s offer of gambling services without a national licence. 

Filings at Malta Business Registry show that a Cypriot national and a Maltese national were appointed directors of the company in September 2019. In 2021, the Maltese director resigned and the Cypriot signed a document initiating the dissolution of the company, which is ongoing.

In 2024, the Austrian Supreme Court put questions to the EU Court of Justice to clarify whether the directors are liable and which law should apply.

According to the government of Austria, “cross-border supply of gambling activities is not allowed”. But Malta-based firms operate websites without licenses in some countries they target.

Gambling laws are not harmonised in the EU, and there is no obligation for authorities to recognise gambling licences from another EU country.

There is case law that repeatedly recognises the rights of EU countries to restrict the cross-border market of gaming services, but restrictions (such as more stringent criteria for a national licence) must be proven to be proportionate.

The top EU court ruled that “the damage sustained by the player is deemed to have occurred in the country in which that player resides”. In this case it’s Austria, so Austrian law should apply.

Moreover, failing to obtain a gambling license is a breach of a general law protecting the public, not an internal company management issue. 

This means it does not fall under the company law exception, which would be protecting the directors from liability. It remains for the Austrian courts to rule whether the directors are guilty, but this should be done under the law governing non-contractual obligations and not company law.

Bill 55’s fate is yet undecided

Although not directly addressed by the recent ruling, Bill 55 is also under EU scrutiny.

Under Bill 55, Maltese courts can “refuse recognition and, or enforcement” of any foreign judgment involving companies registered on the island, namely the gambling industry.

In an interview with iGaming Capital, lawyer Terrence Cassar explained that the relevant article introduced by Bill 55 “would only ever come into play at the point where a foreign judgment is presented for recognition and enforcement in Malta.” 

“At that stage, the Maltese legal position is that such a judgment would simply not be recognised,” he said.

MGA’s spokesperson also underscores the limited scope of the ruling:

“It is also important to emphasise that this judgment was strictly limited to the interpretation of the Rome II Regulation (Regulation 864/2007), which determines which country’s law applies in civil and commercial matters involving non-contractual claims.”

“The Court did not pronounce itself on the substance of the underlying player claim. It does not relate to Article 56A (formerly Bill 55), which addresses a different legal context and reflects Malta’s established public policy on gaming matters,” the spokesperson added.

Amphora Media analysed Maltese court cases since the adoption of Bill 55. We found 81 first-instance judgements involving gambling companies and 32 appeals that cited the relevant legislation.

Not all of these were court judgements about refunding gambling losses. The court issued interim judgements on many procedural requests, responding to challenges brought by either side – the gambler or the company – including garnishee orders and requests for recusal.

“In light of the narrow and technical nature of this judgment, Malta’s position vis-à-vis the player claims remains that operators licensed in Malta may continue to operate cross border where they have a justifiable legal reason to do so,” MGA’s spokesperson said. 

However, more rulings may be in the pipeline. 

In June last year, the European Commission also opened infringement proceedings against Malta “for failing to comply with its obligations under the Regulation on jurisdiction and the recognition and enforcement of judgements (Regulation (EU) 1215/2012) in the area of gambling”.

Read more:

• EU institutions agree on a list of safe countries to which asylum seekers can be sent, either because they come from these countries, have transited through them, or because their governments agree to process asylum claims there.
• Five EU safe countries still have the death penalty.
• Malta is already deporting people to these countries in large numbers, but most deportees do not appear to have arrived irregularly.
• The government praises a high deportation-to-irregular-arrival ratio, but the nationalities of deportees do not fully reflect arrivals by sea.

Malta is already deporting large numbers of people to countries the EU now plans to designate as “safe”.

Recently, Home Affairs Minister Byron Camilleri praised a swift operation where migrants rescued at sea in December were deported in a matter of weeks. But most of those deported over time were not asylum seekers, raising questions about what the bloc’s new safe countries list will actually change on the ground.

On 18th December, the European Parliament and Council (the latter represents governments) agreed on the first-ever EU-wide list of safe countries of origin, allowing member states to fast-track or reject asylum applications from nationals of those countries.

While the move is intended to expedite asylum decisions and increase returns, Malta’s data suggest that deportation figures, often cited by the government as evidence of effective migration control, are driven more by the return of migrant workers and visa overstayers than by asylum policy.

What has the EU proposed?

At the EU level, the following countries will be designated as safe countries of origin, with limited exceptions: all EU candidate countries, Bangladesh, Colombia, Egypt, India, Kosovo, Morocco, and Tunisia.

Five of these countries – Bangladesh, Egypt, India, Morocco and Tunisia – retain the death penalty in their laws.

“Where we can go faster, we should go faster,” EU migration commissioner Magnus Brunner said, arguing that faster procedures are needed to address asylum backlogs across the bloc.

While the list is new at the EU level, the idea is not. Currently, EU member states maintain their own lists of safe countries and regularly update them. Malta’s list does not include Colombia or Kosovo and does not automatically extend to EU candidate countries.

“When you have a high influx of refugees coming from a certain country, this country is often inserted into the [national] list,” said Gaia Romeo from the Vrije Universiteit Brussel, who focuses on the implementation of EU safe country policies in her PhD.

“The EU has been trying to have a common list of safe countries of origin since 2004,” she explained.

What about vulnerable groups?

The new EU rules can make it easier to reject asylum applications under examination and expedite the processing of pending claims. The new rules would not affect Ukrainian applications due to the ongoing conflict there.

The final text stresses that individual assessments will still be required but that the onus will now be on the applicant to justify “why the concept safe country of origin is not applicable to him or her”.

It says that “special attention” should be paid to applicants in vulnerable situations, including LGBTIQ persons, victims of gender-based violence, human rights defenders, religious minorities and journalists.

But experts warn that these safeguards risk remaining largely theoretical in accelerated procedures.

“It really depends on how it is implemented,” Frowin Rausis, who researches asylum policy at the University of Geneva with an EU-funded project called “Finding Agreement in Return”, told Amphora Media.

“Cases that concern gender based violence and LGBTQI (…) need a lot of trust, time, and resources that might be absent in an accelerated procedure. If you can’t identify them, you’‘ll also not be able to protect them,” he said.

Romeo points to similar concerns in Italy.

“I’ve been told of many cases of people who had a very evident vulnerability or were in the need of protection, but the process was too fast, because they could not understand the procedure, couldn’t access a lawyer, or they didn’t trust the system,” she said.

“Someone coming from a very repressive system needs some time to understand whom they can trust.”

Malta: Asylum in numbers

Malta will be entering the new EU framework with asylum applications at their lowest level since 2010.

In 2024, the largest number of asylum seekers came from Syria (which accounts for nearly half of all applicants), Colombia and Bangladesh. Over 500 applications were left pending. These applicants were predominantly from Syria, Ukraine and Sudan. 

According to 2024 data compiled by aditus foundation, Malta considered 88 applications inadmissible.

Malta has been found in violation of asylum seekers’ rights on multiple occasions. Since 2004, it has lost five cases at the European Court of Human Rights, including rulings concerning the detention of Bangladeshi asylum seekers and the failure to properly assess the case of a Bangladeshi journalist.

This is how asylum seekers from the countries on EU’s safe list fared in Malta

Deportations: Are rejected asylum seekers leaving Malta?

The government said the number of migrants returned is around 81% of irregular arrivals, and that arrivals themselves have fallen by 93% over the last five years, thanks to effective return policies for those not qualifying for protection. Statistics on sea arrivals and deportations in 2025, as referenced by Minister Camilleri, have not yet been published.

Between 2020 and 2024, Malta deported 1,840 individuals. Nationals of countries now designated as safe at the EU level feature prominently among those returns, according to Eurostat data.

The data does not distinguish between forced returns of asylum seekers and other migrants. Five of the ten countries on this list grant EU citizens visa-free short-stay travel.

This suggests that about one-fifth of all deportations over the five years involved citizens who arrived in Malta visa-free and likely overstayed their visas. According to Jobsplus, as of December 2024, India, Nepal, Colombia, Serbia, Albania, Pakistan and Bangladesh featured among the top nationalities of employees in Malta.

Most deported nationalities in Malta in 2024 (highlight: visa-free travel)

The ranking of the most deported nationalities has remained stable over time. For each nationality, the number of migrants holding work permits far exceeds the number of deportations, showing that most deportations concern migrants other than rejected asylum seekers.

Most deported nationalities in Malta 2020-2024 (highlight: visa-free travel)

Note: no overstay data from 2020 was published. NSO publishes nationality data on boat arrivals only when that nationality is included among the most common nationalities, so the numbers are expected to be higher

When deportation figures are compared with boat arrivals, the discrepancy becomes clearer.

Some Bangladeshis and Egyptians used the sea route, but most of the other sea arrivals in 2024 were from Syria (46 people), Pakistan (31), Eritrea (9), Ethiopia, Ghana, Sudan (3 each), and Palestine (2).

During 2020-2024, Bangladeshis constituted the largest number of sea arrivals (21%), followed by Sudanese (18%), Eritrean (12%), Syrian (9%) and Somali people (210).

The data suggest that most deportations do not concern rejected asylum seekers, but migrants who entered Malta through other channels, including labour migration and visa-free travel.

Malta has deported one Syrian since 2020, alongside 33 Pakistanis, 40 Ghanaians, no Eritreans, Sudanese, Palestinians and Ethiopians.

Malta is already deporting people to Bangladesh, Egypt, India, Colombia, Morocco and several EU candidate countries, all of which feature on the EU’s new safe countries list. Nepal is the only country among Malta’s most frequently deported nationalities that does not.

Taken together, the figures indicate that Malta’s high deportation-to-arrival ratio is driven by two factors: a sharp decline in sea arrivals, and a large number of returns involving non-asylum migrants.

As a result, deportation figures are more accurately understood in relation to overall migration flows, rather than arrivals by sea alone.

EU proposal has limited impact and familiar problems

EU data shows that member states already maintain and revise their own lists of safe countries, which are frequently challenged in court.

In recent years, Greek courts rejected Türkiye as a safe third country, Italian tribunals ruled that Tunisia could not be considered safe, and Dutch authorities concluded that Colombia, now on the EU-wide list, does not offer sufficient protection for asylum seekers.

Rausis doubts the new framework will significantly increase returns or harmonise asylum policy.

“The harmonisation effect is limited, but more importantly, the question of return is critical for many countries.  This will make it more effective in the best case to get a return decision.”

“But the actual question of whether people are returned is not based on this kind of unilateral declaration. It’s really about the extent to which the cooperation with third countries is working.”

Romeo agrees. “Candidate countries tend to cooperate on returns, but then it’s very easy for [their citizens] to return to the EU.”

For Malta, the EU’s safe countries list may streamline procedures at the margins. But it does not explain, or justify, a deportation narrative that is driven largely by migrants who never entered the asylum system in the first place.

Further reading:

Each year, the red briefcase appears, the finance minister rises, and the word “budget” dominates the news. Behind the ritual lies a simple question: how exactly does Malta’s government make and spend its money?

The answer involves billions of euros and thousands of line items but one key idea: money comes in through taxes, flows through ministries and programmes, and circles back as salaries, benefits, and infrastructure.

Ahead of the 2026 edition, this guide breaks down the estimates from Malta’s 2025 budget into three parts: where the money comes from, how it’s spent, and how the country manages the gap between the two.

How does the government make its money?

Malta’s government revenue and financing is made up of taxes, non-tax revenues, and borrowing: the three pillars of state financing.

1. Taxes: the backbone of government income

The government’s primary financial engine is its residents and businesses.

According to the 2025 budget estimates, total tax revenue is estimated at just under €6.9 billion. 

Malta’s tax revenues have increased significantly over the last decade or so, coinciding with population and migration growth. In 2013, tax revenues stood at nearly €2.5 billion and reached around €5.6 billion by 2023.

Tax revenues are split into direct and indirect taxes.

Direct taxes, the largest share, are made up of income tax (€2.85 billion) and social security contributions (€1.64 billion). Together, these make up about 65%* of all tax revenues and roughly half of total government revenue.

The latest official data shows that in 2023 alone, households contributed €1.5 billion, or almost two-thirds of all income tax collected. The closest contributors are non-financial corporations (€449 million) and financial corporations (€407 million).

The largest indirect tax is sales tax, or Value Added Tax (VAT), which is estimated to generate around €1.6 billion in 2025.

Here is a breakdown of tax income:

Direct:

• Income Tax: €2,848,000,000
• Social Security: €1,642,000,000

Indirect: 

• Customs and Excise Duties: €329,000,000
• Licenses, Taxes and Fines: €467,000,000
• Value Added Tax: €1,611,000,000

Other government income:

Beyond taxes, the government expects to collect around €620 million in non-tax revenues in 2025.

The largest component is grants, mainly EU funding, which support a range of projects, including infrastructure, agriculture, integration, and security initiatives. In 2025, grants are expected to total more than €288 million.

The next biggest slice is “Fees of Office”, forecast at €112.6 million for 2025, which covers a range of administrative income, fees, and charges from government institutions. 

Two key contributors here are the Residency Malta Agency (€30 million) and the Granting of Citizenship for Exceptional Services (€30 million). However, this is expected to change following an EU court order ending the citizenship-by-investment programme. 

The government also earns dividends from state investments, projected at more than €58 million in 2025, up from €44 million in 2023 but slightly down from 2024’s €61.7 million.

How the Government Spends Its Money

The Consolidated Fund:

All revenue, with limited expectations, including your taxes and social contributions, flows into Malta’s Consolidated Fund.

Think of it as the government’s main bank account, the source of funding for everything from urban greening to hospital maintenance, divided each year among ministries, agencies, and public services through the budget.

The Consolidated Fund operates at a deficit, meaning it spends more than it receives in income. It is expected to stand at almost €744 million in 2025, slightly below 2024’s €771 million.

Recurrent and Capital Expenditure:

In 2025, total recurrent expenditure, the everyday cost of running government and its services, is projected at €7.3 billion . Another €1 billion is earmarked for capital expenditure, long-term investment in infrastructure, schools, and hospitals.

By 2027, total recurrent expenditure is expected to rise to near €8.9 billion.

Government expenditure is grouped into four main categories. Together, they tell you how the €7.3 billion in recurrent spending is distributed.

Programmes and Initiatives dominate the budget, covering subsidies, grants, and social spending, accounting for roughly 60%.

The largest beneficiaries of programmes are:

• Social Security: €1.6 billion
• Social Policy: €544 million
• Health Ministry: €397 million
• Environment and Energy Ministry: €320 million (including €152 million for energy subsidies)
• Finance Ministry:  €230 million.
• Active Ageing:  €145 million.
• Transport Ministry: €135 million.
• Pensions (for civil servants etc.): €105 million

Out of the €1.6 billion spent on social security benefits:

• €833.8 million is retirement pensions
• €200 million is widows’ pensions 
• €147 million is under a bonus 
• €90 million is under the children’s allowance

However, this is funded through social security contributions. An additional €105 million is earmarked for pensions.

That means that a total of €1.38 billion is spent on pensions.

Personal Emoluments are salaries, allowances, overtime, and social contributions for civil servants and political officeholders, including MPs and Cabinet members. Around 21% of spending.

The largest payrolls are at the Ministry for Health (€473 million), Education (€375 million) and the Police (€102 million).

Operational and Maintenance Expenses include utilities, rent, repairs, travel, professional services, and administrative costs. These include the €220.8 million for third-party contracts and €25.7 million for consultancy and professional fees.

Contributions to Government Entities, such as state corporations and authorities, absorb the remaining €925 million.

Capital Expenditure:

The government also sets aside ‘Capital Expenditure’ in the budget. Capital Expenditure is public investment in more durable assets, such as infrastructure and major projects.

The largest spenders by capital expenditure are:

Total spend:

The 2025 Budget distributes these billions across Malta’s ministries. The Ministry for Health and Active Ageing takes the lead (€1.5 billion), followed by the Ministry for Education, Sport, Youth, Research and Innovation (€1 billion) and the Ministry for  Social Policy and Children’s Rights (€739 million). 

Top 5 ministries account for well over half of all government spending:

Social security & Pensions: the single largest item

No programme consumes more money than Social Security Benefits, budgeted at €1.6 billion in 2025, roughly one euro in every five spent.

Out of the €1.6 billion spent on social security benefits:

• €833.8 million is retirement pensions
• €200 million is widows’ pensions 
• €147 million is under a bonus 
• €90 million is under the children’s allowance

However, this is funded through social security contributions. An additional €105 million is earmarked for pensions for civil servants and other public personnel.

The Ministry for Social Policy oversees another €553 million in social spending.

Healthcare follows as the second-largest area of expenditure, with €1.1 billion in allocations for 2025. Within that:

• Within that Active Ageing alone accounts for €305 million. That includes long-term institutional care and community care.
• Hospitals like Mater Dei, Mount Carmel, Gozo General, Karin Grech, and St. Vincent de Paul: €265 million
• Primary healthcare and community services: €73 million

The next is education. The Ministry for Education, Sport, Youth, Research and Innovation receives €485 million, with an extra €459 million earmarked for Education-specific spending. The total budget exceeds €1 billion.

Other major recipients include the Ministry for Environment, Energy and Public Cleanliness at €685 million, which includes the €152 million spent on support measures to keep energy prices stable.

Meanwhile, Malta’s spending on research and innovation as a share of its GDP is the second-lowest in the EU and has decreased since 2013.

Security, Local Councils and Justice

Despite being fundamental to shaping daily life, security, justice, and local government receive relatively small shares of the overall pie.

The Police were earmarked €110 million for 2025, around 1.5% of total expenditure. However, that is mostly spent on salaries, overtime and allowances, despite relatively little changes in personnel.

The Armed Forces (€86 million or 1.1%) and Civil Protection (€13.9 million or 0.1%) are provided with even less.

Local councils, in particular, operate close to residents and are on the front lines of community issues, but command less than 1% of total expenditure with €64 million earmarked for 2025.

The Ministry for Justice, which also includes the reform of the construction sector beyond its responsibilities over the courts (which have the worst delays in Europe) has a total budget of €77 million, around 1% of total spending.

Deficit and Government debt

Malta’s budget operates at a deficit, meaning the government spends more than it earns. To cover this gap, it borrows money. For 2025, Local Loans, the primary source of covering Malta’s debts, are estimated at €1.5 billion.

Malta’s government has consistently reduced its deficit. The general government deficit declined from 4.7% in 2023 to 3.7% in 2024 and is projected to decrease further to 2.8% in 2026.

Still, public debt servicing, which covers the interest and principal repayments on its outstanding debt, is rising:

2023: €696 million
2024: €787 million
2025: €886.6 million
Projected by 2027: €1.3 billion

According to the budget estimates for 2025, €312 million is allocated for interest public debt payments alone.

By the end of 2024, total government debt was around €10.6 billion, equivalent to 46.2% of GDP. It was up by €821.2 million from the previous year.

As of the end of August 2025, debt stood at €11.1 billion, an increase of €1.1 billion from the same time last year.

Here is a breakdown of spend per Ministry, showing at which sectors the state supports, and which pressures it prioritises:

Malta promises to eliminate its citizenship-by-investment program and expanding a discretionary citizenship scheme for individuals of ‘exceptional merit’, bringing to end a saga that started with a cautious agreement between Malta and the European Commission and culminated in a damning judgement by the Court of Justice of the European Union.

What was the case about?

The European Commission began challenging Malta’s citizenship-by-investment programme, also known as a golden passports scheme, in 2020.

Its argument focused on the claim that Malta sells citizenship of the entire European Union, without establishing whether the investor has, or will develop, links to Malta itself beyond the transactional requirements.

The Court upheld the transactionality argument. The judgement does not impact Malta’s current residency-by-investment scheme, where foreign nationals can buy residency rights but not a passport.

What exactly has changed?

“The amendments strengthen the existing laws related to merit-based citizenship. They are also consistent with Malta Vision 2050, with an emphasis on the need for added value and job creation,” the Home Affairs ministry said in a statement announcing the change.

An accompanying document specified that the amendments will be “removing all references to the Grant of Citizenship for Exceptional Services program, the transaction and even the agents of the programme.”

Licensed agents will still be able to facilitate the purchase of a Maltese golden visa.

Research by the Daphne Caruana Galizia Foundation has shown that the golden visa intermediary ‘market’ is extremely concentrated, and there are cases of revolving door, where high-ranking officials became visa agents.

The citizenship amendments provide considerable flexibility, but there remains a lack of clarity regarding the exact criteria and how the new framework will operate.

The new amendments would return Malta to its pre-2013 citizenship regime. Under a 2007 legal amendment, investors could become citizens at a minister’s discretion, without a structured programme, for so-called exceptional services. The 2013 amendment set a price and other structured conditions.

The proposed amendments define exceptional services and exceptional merit as “services rendered and contributions made by scientists, researchers, athletes, sports persons, artists, cultural performers, entrepreneurs, philanthropists and technologists, amongst other persons of interest”.

There are no references to obligatory investment in real estate in the published document. It appears that job creation will be a key indicator. There is also no mention of extending citizenship to family members.

Malta already runs a merit-based citizenship scheme. The government’s FAQ emphasised that existing structures will be used for the upgraded scheme.

Applicants will submit their requests to the Komunità agency, which will then initiate a due diligence process and forward the outcome to the existing evaluation board.

The board, after conducting interviews and deliberations, will issue a recommendation to the Home Affairs Minister, who will make the final decision.

People who have already acquired citizenship through the previous programme will remain citizens.

Under the citizenship-by-investment scheme, citizenship buyers have proven very difficult to deprive of their purchased passports.

Amphora Media’s investigation in February showed that Pavel Melnikov was the only known citizenship buyer to have lost his Maltese passport at the time. He was found guilty of aggravated tax fraud and aggravated accounting fraud.

Who benefitted from the citizenship by investment scheme?

The scheme was benefiting local intermediaries, such as agents and real estate owners. According to government figures, citizenship sales generated €339 million from property purchases and €158 million from property rentals.

Applicants were eligible for the scheme if they rented a property for €16,000 annually for five years. This is less than the average rent for a two-bedroom apartment in St Julian’s or Sliema.

When the Court of Justice announced its judgement in April, Prime Minister Robert Abela defended the scheme, claiming it had generated “almost a billion and a half euros that we have invested in people”, helping them “in their hour of need” during moments like the pandemic.

Amphora Media’s fact-check has shown that as of July 2024, less than 10% of the reported €1.4 billion generated from the scheme went into social projects, and that just €41,847,629, or one-third of the amount promised, had been paid out. It remains to be seen what will happen with the rest of the fund.

20th June came and went. Contrary to Prime Minister Robert Abela’s public commitment, Malta did not formally recognise Palestinian statehood. The government blamed a postponed UN conference — but the truth is simpler: Malta is already widely regarded, including by the United Nations, as having recognised the State of Palestine.

That recognition came back in 1988. What remains is a formal domestic act — a vote in the Parliament of Malta to enshrine that declaration in Maltese law.

The relationship between Malta and Palestine dates back to the 1970s under Dom Mintoff’s government. In 1974 Malta voted in favour of granting the Palestine Liberation Organisation (PLO) observer status at the United Nations. A few years later, a PLO office opened in Malta — operating as a de facto embassy, well before full recognition of Palestinian statehood.

The decisive moment came on 15th November 1988 when the Palestinian National Council declared an independent State of Palestine in Algiers.

The next day, Malta submitted a declaration to the UN, affirming “the right of the Palestinian people to a state of their own”.

It joined a wave of over 80 countries — many from the Non-Aligned Movement — to do so. By December, Malta even voted in favour of a UN resolution backing the declaration.

Malta’s recognition has since been treated internationally as an official acknowledgement of the Palestinian state.

Malta has also been regularly listed in UN documents as one of the 147 nations that recognise Palestinian statehood. The Maltese government has not disputed this a single time over nearly four decades.

In 2024, Malta was among the countries in the UN Security Council that voted in favour of full recognition of Palestinian statehood, which was blocked following a United States veto.

This recognition was not merely symbolic.

To this day, Malta continues to have a Palestinian mission in Malta that operates as a full diplomatic entity. There is a Palestinian Ambassador and a Representative Office of Malta in Palestine, and Palestine continues to be referred to as a “state” in official communications – privileges that would not apply to an unrecognised entity.

Malta has also served as the Rapporteur of the Committee on the Exercise of the Inalienable Rights of the Palestinian since its inception in 1975.

Diplomatic exchanges have been frequent, and several Maltese heads of state have either visited Palestine or hosted their counterparts.

In 1999, President Guido de Marco visited Yasser Arafat, who returned the visit in 2004. In 2008, President Eddie Fenech Adami hosted Mahmoud Abbas in Valletta. And in 2019, President Marie Louise Coleiro Preca and Prime Minister Joseph Muscat visited Bethlehem and Ramallah, where they met with Abbas and Prime Minister Muhammad Shtayyeh.

However, there is a legal and procedural gap: Malta has never completed the formal parliamentary process to legalise this recognition domestically.

Malta does not have a rigid, codified process for recognising states. In the past, recognition involved more than simple declarations; it was formalised by Parliament, the country’s supreme law-making body.

When Malta recognised Kosovo in 2008, the process involved a debate in parliament’s Foreign Affairs Committee, followed by the submission of a formal diplomatic instrument and an official letter to the Kosovan leadership.

In Palestine’s case, this domestic step was never taken — meaning that while Malta is seen internationally as having recognised Palestine, no official act of recognition exists. Since 1988, successive governments — both PN and PL — have failed to complete this legal process that could have begun 40 years ago. 

In 2024, Malta’s government said that it was prepared to recognise Palestine “when the circumstances are right and such recognition can make a positive contribution.” By 2025, the Prime Minister went one step further. 

“After 45 years of discussion within our country about whether to recognise Palestine as a state, it will be a government led by me that will recognise a Palestinian state,” he said,  indicating 20th June as the intended date. That day passed without action.

In the aftermath, Abela reaffirmed Malta’s commitment to recognising Palestinian statehood but added a caveat: “once the appropriate circumstances are in place.”

The solution is straightforward. Prime Minister Robert Abela or Foreign Affairs Minister Ian Borg must simply inform parliament before taking the next step.  Any Member of Parliament — from either party — can also table a motion to recognise Palestine formally.

No new UN declaration is required. What is needed is a domestic legal process that aligns Malta’s national stance with its international position. Recognition was given in word and deed in 1988. All that’s missing now is the law.

Wax paper from your sandwich. Delivery containers. Wet wipes. Frayed, low-quality leggings from a fast-fashion app. Many daily-use items become waste that cannot be recycled. The proposed solution: a waste-to-energy facility at Magħtab.

But is it the most effective way out of the country’s waste crisis? An analysis of available waste treatment solutions shows that all of them have limitations.

Will it absolve Malta of recycling obligations?

Landfilling, which means dumping waste in the ground, is Malta’s most common but costliest waste management method given the country’s space limitations. 

Malta is under pressure from the EU to reduce landfilling of waste. The country relies on waste export, so the plan for new facilities also aims to increase the country’s self-sufficiency.

In addition to the energy-generating plant, a thermal treatment facility (which ‘cooks’ waste at high temperatures to undo its hazardous properties) is planned within the same complex, replacing the one currently operating in Marsa. The two facilities are different and serve separate waste streams.

In a 2018 technical report, then-Minister for the Environment Jose Herrera called the government’s commitment to setting up a waste incinerator a “bold” decision. 

“This was an environmentally responsible decision and will not affect our ambitious objectives to increase our recycling efforts in order to meet the 2030 recycling targets,” he stated in the foreword. The report noted that UK islands, such as the Isle of Wight and the Isle of Man, had waste-to-energy facilities.

A 2016 study found that exporting waste to other EU countries for processing would cost tens of millions of euros every year.

The incinerator plan faces criticism. For example, in a public consultation, Friends of the Earth and Moviment Graffitti wrote that “building a Waste to Energy Plant was in no way a ‘green’ solution”.

“A lot of people will think of the incinerator as a quick solution. It’s not, it requires a lot of planning, a lot of money,” says Dr Margaret Camilleri Fenech, who researches waste management at the University of Malta.

She warns of the so-called rebound effect – people waste more when they know that mitigation measures are in place.

“I am scared that we’ll shift into that [mindset], but we still have recycling targets to respect, which we’ve never managed to anyway,” she says, adding that Malta will not likely to be able to use the incinerator to dig up old landfilled waste and clean up former landfilling sites, because it is mixed with construction waste.

“We have a high level of construction waste, for example. Obviously, we cannot burn it. And our organic fraction has a lot of food waste. There’s a lot of water content, so obviously you need to dry it up to burn, and we still need to respect the recycling target of the EU,” she says.

Insufficient capacity to prepare waste for recycling

Malta ships its waste to various countries. Figures from Eurostat, the EU statistical agency show that Malta shipped over 14,000 tonnes of paper and cardboard to India, over 1,200 tonnes of plastic to Türkiye, and over 1,200 tonnes of synthetic waste textiles to the United Arab Emirates. Data shows that some of Malta’s waste is already burned for energy, but again, abroad.

The probability of recycling recyclable materials, such as plastic, depends on how clean they are when they arrive at the point of waste separation. A 2021 audit reveals that focusing on plastic is crucial. In Malta’s case, plastic destined for recycling is not clean at all.

The audit found that “Malta lacks the infrastructural capacity to engage in more comprehensive and sustainable waste management” and that, at the time, only around a tenth of all plastic collected was being recycled, while two-thirds were landfilled locally.

It further explained that incineration (burning) with energy recovery would be preferred to landfilling when it comes to dealing with plastics rejected for recycling and plastics that residents and businesses threw into the mixed waste bags – these were not separated and considered for recycling “due to the non-availability of operational capacity”.

New schemes will divert some waste

In 2023, waste separation became an obligation for individuals, companies and the government, subject to penalties.

Differentiated gate fees for disposing of waste at specific sites also discourage the delivery of mixed waste, as this is more expensive. Incentives to bring reusable cups for drinks were supposed to be operational since 2022 but remain rare.

In 2024, Circular Economy Malta, a government agency, introduced a scheme to encourage shops to offer discounts or other benefits to users who bring their own containers.

The agency claims that this initiative has successfully prevented the use of 63,524 single-use containers. However, 54,966 of them (87%) were detergent containers – typically made from sturdy plastic and recyclable. Existing reuse options do not address the issues with filmy and dirty plastic, or mixed materials.

According to Friends of the Earth Malta, an environmental NGO, “The [waste management] problem has been exacerbated in recent years by the country’s growing population, the tourism boom, and the “growth at all costs” mantra.”

“The tourism industry produces so much waste, when we look at the figures. Most of the time, we’re looking at how much money the tourism industry is bringing in. Still, we don’t look at how much waste they are producing, at how much water they’re consuming, energy, congestion, and we should balance these things out,” Waste researcher Camilleri Fenech added.

In response to a parliamentary question in January, Environment Minister Miriam Dalli said that the waste-to-energy plant will process 40% of Malta’s non-recyclable waste and provide 4.5% of the country’s energy needs.

Malta’s consumer and tourist economy creates a demand for easy waste solutions. Currently, dumping most waste into landfills and shipping it abroad serves as such, but this practice will be increasingly regulated and expensive. Years of explaining to people and, crucially, companies about how to do the right thing have achieved very limited results. Given Malta’s growing waste generation, the mountain of waste is being treated as one of the most reliable renewable energy sources.

This narrative is two-pronged: 

• Other countries are running similar golden passport schemes,
• The EU Commission had initially approved the scheme before u-turning under the influence of the Nationalist Party.

Is this accurate?

The idea that other EU countries run similar golden passport schemes, yet only Malta faces criticism, is longstanding.

It is a narrative used by Malta’s Prime Minister Robert Abela and his predecessor, Prime Minister Joseph Muscat.

The Nationalist Party’s stance is less clear, with the party’s manifesto calling for the scheme to be amended, and not scrapped. 

The idea that Malta has been unfairly singled out has been regularly repeated following the court ruling, namely by MEP Alex Agius Saliba in an address to the European Parliament, and MP Alex Muscat in a recording of ‘Il-Kazin’.

“I’m also astonished that Austria—a Member State with a scheme identical to Malta’s—has been left entirely out of the discussion. I am amazed at how Cyprus, Greece, Italy, Latvia, Luxembourg, Portugal and Spain, which all have residence-by-investment schemes, can continue operating similar schemes, yet when it comes to Malta, it’s as if, because there is someone who to fans, all the windows get shut,” Agius Saliba said.

“We will abide by the Court’s decision so that we can keep a scheme that continues to generate wealth, because Malta is in no way inferior to any other Member State,” he added.

It has even extended to operators. Henley & Partners, a leading service provider for passport buyers, claimed that the “ruling, targeting the smallest EU Member State, sets a worrying precedent for the undemocratic extension of EU competences beyond its treaty-based limits.”

“It would be interesting to see what the outcome would have been if the case were against France or Germany,” it added. 

Another key claim in the current narrative is that the EU Commission approved the citizenship-by-investment programme after Malta implemented the necessary amendments, only to u-turn later following pressure by the Nationalist Party.

Both Abela and Joseph Muscat have fanned the flames of these claims. Abela has said that the PN staged a “systematic attack” and “then Simon Busuttil, David Casa, Roberta Metsola, who went out to celebrate that same day of the sentence”.

Meanwhile, Muscat told his social audience to “give a round of applause to Roberta Metsola and the PN who have worked against our country since the first minute”.

In the European Parliament, MEP Thomas Bajada described the golden passports scheme as a “programme that the EU Commission had approved, and we amended it where it was needed.”

Neither MEP replied to our request for comment to clarify the claims.

Did the Commission approve the golden passports scheme?

On 29th January 2014, two weeks after a damning resolution by the European Parliament, the EU Commission and the Maltese government reached an agreement over the golden passports scheme, which required that no citizenship or “certificate of naturalisation” would be issued unless:

“The applicant provides proof that he/she has resided in Malta for at least 12 months immediately preceding the day of issuing the certificate of naturalisation.”

The reached agreement was taken as an endorsement.

In 2021, the Passport Papers investigation exposed that officials often waived the requirement for a physical presence. 

Applicants submitted receipts for consumables or newspaper subscriptions, and the average time spent in Malta, according to calculations by the Daphne Caruana Galizia Foundation, was 16 days.

The Commission’s use of “effective residence status” in its press release about the agreement suggests that the Commission was not aware of this creative interpretation of residency. 

It referenced the investigation in the ECJ case, noting:

“The actual physical presence in Malta is required on two occasions only: to provide biometric data in order to obtain a residence permit and to swear the oath of allegiance”, and that the “legal residence” (rental or property purchase) does not constitute a “genuine link”.

The Commission’s spokesperson did not reply to a request for comment.

Was Malta singled out? Do other EU member states have similar programmes?

In 2019, the EU Commission published a comprehensive report on the risks of investor citizenship, focusing on Bulgaria, Cyprus and Malta, which were running such schemes at the time. 

The Commission’s report also noted that some countries run discretionary citizenship pathways, which are “used on a limited basis”. 

In 2020, formal notices and comments were sent to Malta, Cyprus and Bulgaria. Cyprus repealed the scheme that year, while Bulgaria halted its programme in 2022.

The Commission referred Malta to the European Court of Justice in 2022, stating that passports are granted “in the absence of a genuine link with the naturalising country, such as long-term residence.”

As of 2024, most countries in the EU had residency visas for investors, known as golden visas, which differ from citizenship by investment, or golden passports, which offer a passport, citizenship and nationality.

Austria says it does not have a citizenship-by-investment scheme. 

Austria does offer exemptions for investors, but these are discretionary. While there is no minimum investment amount, applicants must make a substantial, active contribution to the Austrian economy, creating jobs and implementing projects.

Industry sources estimate that it could cost up to €10 million. A Commission fact-finding study found that all applicants for citizenship were required to pass a language and civic knowledge test and prove “uninterrupted registered residence”.

Among residency schemes, only six on the EU’s list focus on passive investment in real estate. Portugal has removed the real estate pathway, and its golden visa concentrates now on job creation or cultural contributions. 

In the case of Portugal, a country often cited in defence of the scheme, an applicant for the residency-by-investment can only become a citizen if they’ve been a resident for at least five years (with sufficient proof of residency), and must also provide certification proving fluency in Portuguese. This is the standard process for naturalisation. 

Malta, like Portugal, has a residency by investment programme. This was not subject to the court decision. 

The Commission has been pressured to do more against citizenship by investment by the majority of the European Parliament, which has repeatedly called on the Commission to ban citizenship by investment and impose stricter regulations on residency by investment.

The claim that the European Commission’s criticism regarding the absence of a genuine link focuses on Malta while ignoring comparable schemes elsewhere is false. 

Since 2019, the European Commission has criticised citizenship by investment schemes in Bulgaria, Cyprus and Malta.

By 2022, at the point of the EU court referral, no other EU country was running a similar scheme.

Austria’s investor citizenship pathway is different from a structured scheme, requiring significant investment in the country that extends to job creation.

Residency by investment (so-called golden visas) should not be confused with citizenship by investment (so-called golden passports).They are entirely different schemes that provide entirely different privileges.

The court ruling does not impact Malta’s current residency-by-investment scheme. 

The EU Commission and European Parliament have made that distinction, with the latter calling for a ban on golden passports and stricter regulation of golden visas.

The claim that the European Commission had approved the scheme in Malta before u-turning is misleading. 

When the European Commission reached an agreement on the scheme in 2014, Malta failed to live up to the agreement. Simply buying or renting property, offering scant evidence of spending, and scarcely setting foot on the island did not amount to a genuine link or proof of residency. Once those facts came to light, the Commission began its legal challenge against Malta.

This project is supported by the European Media and Information Fund. The sole responsibility for any content supported by the European Media and Information Fund lies with the authors and it may not necessarily reflect the positions of the EMIF and the Fund Partners, the Calouste Gulbenkian Foundation and the European University Institute.

The European Court of Justice has condemned Malta’s citizenship-by-investment scheme. Still, Malta’s government and Prime Minister Robert Abela have staunchly defended the scheme, citing a €1.4 billion revenue supposedly created to benefit Maltese people. 

But is that correct? An analysis of published data shows that the actual investment in people is far smaller.

The claim

In a Facebook post, the Prime Minister claimed the scheme generated “almost a billion and a half euros that we have invested in people”, helping them “in their hour of need” during moments like the pandemic.

A government press release cited the €1.4 billion figure, listing several projects:

• More than €60 million to social housing projects, “providing hundreds of social housing apartments”.
• An €8.5 million investment in St Michael Hospice, a state-of-the-art palliative care project.
• €5 million invested in the Puttinu Cares apartments in London.
• A €10 million investment in health centres, 
• “Millions” in equipment at St Vincent De Paul and the cardiology department at Mater Dei Hospital.
• €5 million invested in athletes participating in the Games of the Small States of Europe
• Over €13 million allocated to the construction of a car racing track.
• A €9 million agreement with the Malta Football Association for a new technical centre

The facts

The revenues generated from the programme are channelled into two key streams:

1. The National Development and Social Fund (NDSF) – 70%

The NDSF runs a direct investment portfolio for local economic, cultural or social strategic investments.

Such investments ranged from purchasing Lombard Bank shares to buying art at international auctions to the social projects mentioned above.

It also includes a discretionary portfolio, a BOV-managed fund targeting global investments, like bonds and securities.

2. The Consolidated Fund – 30%

The main government bank account, where all public revenues are deposited and expenditures are made, receives around 30% of the money generated.

It should be noted that the statement says that the percentage sent to the Consolidated Fund increased during the COVID-19 pandemic. However, no official figure could be found for the amount spent from the citizenship scheme revenues during the COVID-19 pandemic.

According to the latest financial statements, the NDSF received €619 million in revenues between its inception and 2022.

€130 million, or about one-fifth, was allocated to projects of social importance.

Prime Minister Robert Abela provided a breakdown of the distribution of the NDSF’s social projects in July 2024, following a parliamentary question from MP Mark Anthony Sammut.

The government did not respond to requests to provide the latest official figures.

The data confirms that as of July 2024, less than 10% of the reported €1.4 billion generated from the scheme went into social projects, and that just €41,847,629, or one-third of the amount promised, had been paid out. 

Notably, just under €7.7 million of the total €60 million promised to social housing had been used by July 2024 – some 13% of the amount pledged. 

In 2019, the NDSF and the Housing Authority pledged to develop 550 housing units. The latest financial statements suggest that works were at the permitting stage, awaiting tenders.

Since then, we have found seven tenders for the construction of housing blocks issued by the Housing Authority and published on the government’s public procurement website. The Ministry for Social and Affordable Housing did not reply to our request for an update.

The data provided by Prime Minister Abela in July 2024 shows some schemes for which no disbursements have been provided. These include:

• The New Hope scheme, which offers a loan for individuals who face difficulties in taking up life insurance.
• Richmond Foundation: KIDS for Development Programme
• CT Scan/MRI St Vincent De Paul Hospital
• SportMalta ‐ Malta Olympic Committee High Performance Strategy

The funds committed to Puttinu Cares were fully disbursed. However, this figure over the years pales before regular donations from the general public at a single charity event, reportedly over €3 million in 2024 and 2025 each.

Successful applicants of the golden passport scheme also donate to charitable causes, which extend to football clubs, band clubs, university departments, the Malta Film Commission, and many others, one of which is managed by citizenship scheme agents themselves.

According to a 2023 report by the regulator, since the beginning of the programme €6,112,648 were received across 1,061 donations.

The claim also included €339 million from property purchases and €158 million from property rentals, which is also not direct investment in people.

Participation in the property market is not direct investment in people, as a 2023 KPMG report showed that growth in the construction and real estate sector did not trickle down to workers’ income.

The government’s spokesperson did not respond to our questions and requests for a breakdown of more updated figures.

The verdict: Misleading – but not entirely false

The claim about the citizenship-by-investment scheme’s contribution to society’s needs is overestimated, and the claim that €1.4 billion was invested “in the people” is misleading.

From the €1.4 billion figure, over 90% of the funds generated do not go directly to social projects – instead, they are either placed in financial instruments, which generate interest, debt securities and other assets – or not utilised at all 

Only €131 million – less than a tenth of the €1.4 billion figure – has been committed to social projects, and only a third has been disbursed.

So while the scheme certainly generated €1.4 billion in revenue, it is inaccurate to say that the billion figure is ‘directly’ invested in the people.

This project is supported by the European Media and Information Fund. The sole responsibility for any content supported by the European Media and Information Fund lies with the authors and it may not necessarily reflect the positions of the EMIF and the Fund Partners, the Calouste Gulbenkian Foundation and the European University Institute.