More than €100 million is earmarked for digitalisation and artificial intelligence under a package of 10 economic initiatives presented by Economy Minister Silvio Schembri.
The measures, presented following Monday's Budget, aim to strengthen productivity, attract quality foreign investment, reduce bureaucracy and encourage innovation, in line with Malta Vision 2050, a statement said.
The initiatives cover taxation, digital transformation, artificial intelligence (AI), industrial development, energy efficiency and economic diversification.
From next year, small companies with an annual turnover not exceeding €1 million will be eligible for a reduced tax rate of 25%, down from 35%, on profits retained or reinvested in their businesses. This was already announced by Finance Minister Clyde Caruana in his Budget 2027 speech.
However, profits distributed as dividends will remain subject to the 35% tax rate, with the measure designed to encourage companies to reinvest earnings in business expansion and development.
More than €100 million for digitalisation
The government plans to allocate more than €100 million to the digital sector next year, alongside a separate scheme worth €120 million that is expected to become operational by the end of this year.
The scheme will offer a 60% tax credit on eligible investments in automation, AI and digitalisation, with the aim of helping businesses modernise their operations and improve productivity.
An additional €20 million in European funding will also be allocated next year to support business transformation, including technological upgrades, digitalisation and investments aimed at improving efficiency and international competitiveness.
New AI strategy targets 40% business adoption
Government will launch an updated national AI strategy next month, setting out more than 80 measures through to 2030.
One of its main ambitions is for 40% of businesses to be using AI within five years.
The strategy builds on the government's existing AI initiatives, including the AI for All programme, which has attracted almost 50,000 registrations. Of these, 32,000 participants have successfully completed the course.
The updated strategy is intended to strengthen the adoption of AI across the economy while developing the skills needed to support technological change.
Malta Enterprise to target foreign investors directly
The government will strengthen and restructure the Foreign Direct Investment (FDI) Unit within Malta Enterprise, with a more direct approach to identifying investment opportunities and engaging with investors and chief executives.
The first visit under this initiative is scheduled to take place in London in the coming weeks.
The move is intended to improve Malta's efforts to attract quality investment and identify opportunities that can contribute greater economic value.
€20 million in European funding for business transformation
An additional €20 million in European funding will be allocated next year to further support business investment, digitalisation and technological upgrades, with a focus on productivity, efficiency and international competitiveness.
Business Wallet to expand
The Business Wallet platform, designed to simplify interactions between companies and public entities, will be expanded as part of efforts to reduce administrative burdens, government said.
The platform has connected seven entities in its first few months of operation, with six more expected to join by the first quarter of next year.
The government also intends to eventually open the platform to the private sector, potentially broadening the range of services businesses can access through the system.
New funding for video games and emerging industries
Economic diversification will also feature in the package, with an initial €2 million fund for companies developing video games and interactive entertainment.
Further schemes will seek to attract international accelerator programmes in emerging fields, including educational technology (EdTech) and chip design.
The initiatives are intended to support innovative businesses and help Malta develop economic activity beyond established sectors.
Solar panels and energy efficiency in industrial areas
A forthcoming policy will encourage greater use of solar panels and improvements in energy efficiency across industrial areas.
The government intends to integrate energy and sustainability considerations more closely into industrial development plans, while taking into account businesses' operational requirements and technical constraints.
The initiative forms part of the wider effort to improve efficiency and support more sustainable economic growth.
First national industrial policy planned
The government will issue a call for the formulation of Malta's first industrial policy, intended to provide long-term direction for investment, infrastructure, technology and skills.
A bill to strengthen the operational framework of Malta Enterprise and INDIS Malta will also be tabled in Parliament in the coming days.
The measures are intended to establish a stronger framework for industrial development and help businesses respond to changing economic and technological demands.
Study into possible land reclamation at Bengħajsa
The final initiative concerns the possibility of land reclamation near the Malta Freeport at Bengħajsa to create an area dedicated to maritime activity.
A call has been issued for a detailed study, accompanied by broad consultation, to assess the proposal.
The process will examine its economic feasibility, environmental impacts, connectivity and infrastructure requirements before any decision is taken on whether the project should proceed.
"These initiatives give concrete form to our ambition for Malta Vision 2050. We are investing in our businesses' ability to compete, in people's skills and in the sectors that can create tomorrow's opportunities," Schembri said.