Parliament refers 4 tax, duty hike bills to subcommittee
These four bills, proposed by the government, aim to revise key tax measures in the tourism and tobacco sectors.
The three tourism-related bills and a bill to increase tobacco taxes and import duties have been referred by the whole parliamentary committee to a subcommittee for further examination.
These four bills, proposed by the government, aim to revise key tax measures in the tourism and tobacco sectors.
The bills under review include:
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Bill to levy taxes and fees on passengers leaving airports
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Bill to increase TGST (Tourism Goods and Services Tax)
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Bill to increase Green Tax under the Tourism Act
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Bill to increase taxes and import duties on tobacco and tobacco products
A committee of the entire parliament held on Wednesday vote:
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TGST increase bill: Approved unanimously by 62 committee members.
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Green tax increase bill: Approved with 61 members in favour.
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Bill to levy taxes and fees on passengers leaving airports: Approved unanimously by 62 committee members.
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Bill to increase taxes and import duties on tobacco and tobacco products: Approved unanimously by 62 members.
Proposed changes to GST Act
The amendment to the Goods and Services Act was introduced by PNC MP Ibrahim Falah and was supported by PNC MP Hussain Sharif. The amendment proposes an increase in the TGST from 16% to 17%, effective June of next year.
During the committee discussions, PNC MP Ahmed Thoriq proposed changing the effective date of the TGST increase to October 31, 2025, instead of June 1. This motion received support from Velidhoo MP Mohamed Abbas and Hithadhoo South MP Ibrahim Nazil, with additional calls to further study the proposed increase.
Any further changes will be addressed in the subcommittee.
Airport passenger tax provisions
The Bill on Levying Taxes and Fees on Passengers Departing from Airports was moved by Inguraidhoo MP Falah, with support from Feydhoo South MP Ibrahim Didi. The proposed amendments include:
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Increasing the departure fee for foreigners in economy class from $30 to $50.
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Maintaining the current fee for Maldivian economy class passengers.
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Increasing the fee for business class from $60 to $120.
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Raising the fee for first-class departures from $90 to $240.
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Raising the fee for jet passengers from $120 to $480.
The changes to airport fees are proposed to take effect in December.
Amendments to the Tourism Act
The proposed increase in the green tax was moved by PNC MP Mohamed Mamdooh and supported by Velidhoo MP Abbas. According to the bill:
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For guesthouses with fewer than 50 rooms, the green tax would rise from $3 to $6.
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For resorts, city hotels, and places serving tourists with more than 50 rooms, the tax would increase from $6 to $12.
Tobacco tax amendments
The bill to increase taxes and import duties on tobacco and tobacco products was introduced by Feydhoo South MP Ibrahim Didi, with support from Funadhoo MP Mamdooh. The proposed amendments include:
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Increasing the specific rate of import duty on cigarettes and bidis from MVR 3 to MVR 8 per cigarette, raising the cost per cigarette to MVR 5.
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Doubling the ad valorem rate on cigarettes and tobacco products from 50% to 100%.
These amendments are scheduled to take effect from the first of next month, pending approval.
All four bills have been referred to the subcommittee for further discussion and revision.
