Brussels has given Malta the green light to pay out twice as much money for films and television series as it was able to until now – which means as much as half a billion euros in funding over the next five years.
The EU Commission approved a state aid package two months ago, allowing the Malta Film Commission to give a maximum of €100 million annually through the cash rebate scheme to production houses that choose to shoot their films or television series partly or entirely in Malta.
The scheme – which has often proven controversial – has been approved till the end of October 2028, and the EU Commission has, this time, doubled the maximum allowable amount since its previous state aid approval in 2022.
Furthermore, Brussels has approved a separate state aid package allowing the Maltese government to pay out another €10 million annually until 2026, just for reality shows and game shows.
This does not mean the government will definitely be handing out that much money, rather it means this is the maximum amount it can pay before it breaches EU state aid law.
The EU limits the degree to which member states can inject money into private companies to preserve a level playing field for businesses across the Union.
The ceiling approved in the previous package was €50 million annually for 2022 and 2023.
According to publicly available figures on the EU Commission’s state aid website, the Malta Film Commission promised over €29 million in cash rebates to various productions in 2022 and over €69 million in 2023.
40% cash back
The money is given as part of a generous cash rebate scheme to attract production houses to shoot their films or TV series in Malta.
The government gives them up to 40 per cent cashback on almost their entire expenditure while they work in Malta, including on cast and crew salaries and rentals of any equipment from outside Malta.
Large productions get hundreds of thousands, and sometimes millions of euros back. Last year, Times of Malta revealed that the Gladiator sequel had broken an all-time rebate record when it secured a whopping €47 million in taxpayer money for filming in Malta.
Since then, no other details of any other cash rebates granted to productions have been made public.
In total, Malta has green-lighted more than €143 million for 54 films and television series over the past six years.
Meanwhile, the government’s allocation for local productions has been capped at just one million euros annually until 2026, following which the government will have to ask for approval again to help its local productions or increase the grants.
This is largely why the scheme has been controversial.
Local film-makers have long complained that the local industry has been sidelined. Industry insiders say the generous rebate is good while it lasts but fear it is too much strain on the Maltese taxpayer and could be unsustainable.
‘Strain’ is unfair
The government and the Malta Film Commission strongly disagree.
They say the scheme is significantly growing the film industry by attracting top Hollywood productions, which in turn inject millions more into the Maltese economy through the hospitality industry and services sectors, create hundreds of jobs for Maltese talent as well as boosting tourism.
In a reply to questions, the Film Commission said it was not fair to frame the scheme as a “strain” on taxpayers, as economic studies show the return on investment on the rebate has been consistently strong for as long as it has existed.
“Independent economic analysis has consistently demonstrated a positive financial impact, and the success of similar initiatives across Europe reinforces this. In these jurisdictions, these initiatives are not only welcomed but they are celebrated for driving investment and fostering industry development,” a spokesperson for the Film Commission said.
“The framing of this issue as a burden to the taxpayer appears to align with specific political rhetoric, which we believe detracts from an objective, fact-based analysis. We stand by the facts.”
Asked to say whether it intends to hand out the maximum amount allowed by the EU, the Film Commission said that amount only “represents a ceiling, not an annual income”.
“It’s crucial to note that in previous record-setting years, this threshold has not been met due to tangible limitations such as the availability of skilled crew and infrastructure capacity,” the spokesperson said, adding that all grants will be publicly listed and accessible online.
“Similar initiatives, also approved by the EU Commission, have been implemented across Europe, further highlighting the importance of such schemes in supporting and sustaining the film industry.
“We remain committed to attracting world-class productions that bring value to the economy, for the ultimate benefit of the industry and its workforce.”
The Malta Film Commission spending has been largely shrouded in mystery.
It has repeatedly refused to say how much taxpayer money it spends on lavish events like the Malta Film Awards and the Mediterrane Film Festival, and when pushed to do so it only says the spend – however big – is an investment in a better and stronger industry.
Last year it also published a study claiming that for every euro invested in the industry, the country gets back three times as much. Times of Malta has so far been unable to independently confirm how that conclusion was reached.