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Network News • 12-01-2024

Newly introduced 12% reduced VAT rate

On the 5th April 2022, the European Parliament adopted Council Directive (EU) 2022/542, which gives Member States wider rights to use reduced VAT rates.

Following this adoption, and as from 1st January 2024, Malta has introduced a new VAT rate to the already existing reduced VAT rates.


The newly implemented 12% VAT rate will apply to:

  • Services consisting of the care of the human body required to be delivered by a person in the exercise of any profession regulated by the Health Care Professions Act (Cap.464), including services supplied in the course of a health studio business of similar business, but not including exempt supplies referred to in item 11 of Part Two of the Fifth Schedule;
  • Hiring of a pleasure boat to a person according to an agreement for any term of part of a term that, when added to the term of a previous hiring, of the same goods or of other goods of the same kind, to the said person during the previous twelve months ending on the date of the beginning of the existing hiring, does not exceed five weeks;
  • Securities custody services (unless they qualify as VAT-exempt); and
  • Management of credit and credit guarantees by a person or body other than those who granted the credit.


Should you require further information in relation to these new changes, please get in touch with Michael Caruana on


Please note that this article is being published solely for informational purposes. It is imperative to note that this content neither constitutes nor should be inferred as legal advice or guidance. PKF Malta Limited explicitly disclaims any responsibility or liability for potential damages that may arise from the utilisation of this information as a substitute for professional legal advice or guidance.

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