A bill to amend the Goods and Services Tax Act, aimed at strengthening action against those who fail to pay GST and bringing changes to the tax system, has been submitted to the People's Majlis, with its first reading held at today's sitting. The bill was submitted on behalf of the government by Kolamaafushi MP Ibrahim Didi.
One of the main aims of the bill is to stop the tax that has been levied since 1 October 2026 on inbound tourism products and services provided by parties that do not have a permanent place of business in the Maldives. The bill also seeks to further strengthen the measures the Maldives Inland Revenue Authority (MIRA) can take against those who are not paying GST.
Under the bill, transactions carried out for the purpose of obtaining a tax benefit will be considered tax avoidance transactions. The Commissioner General of Taxation will have the power to determine that such transactions are not accepted for tax purposes. The bill details what counts as a tax benefit, including situations such as a reduction in the GST payable or a delay in the date by which it must be paid.
The bill will take effect once it is passed, ratified and published in the Government Gazette. According to estimates in the bill, with the abolition of the inbound tourism tax, the state will no longer receive the MVR 1,608.5 million in GST revenue that had previously been projected from offshore booking platforms and foreign tour operators.
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