Malta Introduces VAT Exemption for Public Lift Passenger Transport Services

Summary – key points 

• Malta has amended its VAT legislation to introduce a VAT exemption for scheduled passenger transport services provided by public lifts.
• The exemption is implemented through an amendment to the Fifth Schedule of the Value Added Tax Act (Cap. 406), aligning lift transport with other exempt public passenger transport services.
• The rules clarify the definition of “public lift” by reference to the Passenger Transport Services Regulations, ensuring the exemption applies only to recognised and regulated services.

Article

Malta has adopted Legal Notice 75 of 2026, formally titled the Value Added Tax Act (Amendment of Fifth Schedule) (Amendment) Regulations, 2026, introducing a targeted VAT exemption for passenger transport services provided by public lifts. The measure was enacted by the Minister responsible for finance under the powers granted by article 75 of the Value Added Tax Act (Cap. 406).

The primary objective of the amendment is to extend VAT exemption treatment to scheduled passenger transport services between public places carried out by means of a public lift. This change is achieved by modifying item 11 of Part One of the Fifth Schedule, which lists exempt supplies. A new paragraph is added to explicitly include scheduled passenger transport services by public lifts that are recognised as such by the Commissioner.

In addition to the substantive exemption, the regulations also make technical and structural adjustments to the Fifth Schedule, including renumbering of certain items to maintain internal consistency. These amendments ensure that the new exemption is properly integrated into the existing VAT framework without altering the scope of other exemptions.

The regulations further enhance legal certainty by introducing a clear definition of “public lift”. For VAT purposes, a public lift is defined by reference to the Passenger Transport Services Regulations, and must be operated in accordance with the applicable regulatory provisions. This cross‑reference ensures that only duly authorised and regulated lift services benefit from the VAT exemption.

From a practical VAT perspective, this amendment aligns the treatment of public lift services with other forms of public passenger transport that are traditionally exempt from VAT. It may be particularly relevant for operators of lift services in areas where such infrastructure serves as an essential means of public transportation, and for public authorities or concessionaires involved in their operation.

The regulations form part of Malta’s ongoing refinement of its VAT exemption framework, reinforcing neutrality in the taxation of public transport services while ensuring that exemptions remain clearly defined and appropriately limited.

Source VAT Legislation