Black market dollar purchase can be in tax statement: Ameer
"The result is that businesses are losing money, the price of commodities in the market has gone out of hand and people's pockets are poor".
By
Aishath Fareeha Abdulla
Finance minister Ibrahim Ameer said on Wednesday that if businesses spend more than the official rate to buy foreign currency and the evidence is properly documented, the actual expenses can be included in the tax statement.
Ameer made the statement in a written response to a question from MP Ibrahim Rasheed of Maafannu Central constituency.
MP Ibrahim Rasheed expressed concern and asked the minister that even when there is an official rate of buying and selling dollars in the Maldives, traders do not have enough dollars, so they have to buy dollars at a higher price in the black market. He, however, said it would be a loss to traders as the market rate had to be included in the tax statement while filing tax returns to MIRA.
The standard MIRA is looking at is MVR 15.42 per dollar. The MP pointed out that in the black market, dollars are no longer at MVR 17 but at an even higher rate.
Some of the points raised in Ibrahim Rasheed's question include:
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Businesses are required to submit tax submissions less than what actually costs
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As a result, businesses will have to pay more profit tax than what they actually have to pay
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The result is that businesses are losing money, the price of commodities in the market has gone out of hand and people's pockets are poor
Ibrahim Rasheed asked what steps the finance ministry was taking to resolve the issue.
In his reply, Ameer said:
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Businesses must adhere to international accounting standards while preparing accounts for tax purposes
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If businesses buy foreign currency at a rate higher than the official band and maintain sufficient documentation to confirm that this cost is part of the cost of sale, there is no bar on including this expenditure at the time of filing of tax returns.
The minister also said the MMA was taking steps to reduce the use of dollars to address the problems in the foreign exchange buying and selling system.
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