People's National Congress (PNC) Parliamentary Group Leader Ibrahim Falah has stated that while research is being done on the bill regarding amendments to the Income Tax Act where it looks to include Tourism Goods and Services Tax (TGST) for tour operators and travel agents who serve tourists wanting to travel to Maldives, the Parliament will hold discussions with everyone who works in the tourism industry.
During the debate held at today's Parliament sitting for the bill submitted by North Kulhudhuffushi Constituency MP Mohamed Dawood on behalf of the government, the Parliamentary Group Leader said that the government will approve of the recommendations from the tourism industry and the bill will be passed in such a way that it does not shock the industry.
"During the committee stage, we will hold discussions with everyone who works in the tourism industry and will seek their instruction. The government will approve the recommendations from the tourism industry.
With the approval from President Dr. Mohamed Muizzu, the government will pass these amendments in such a way that it does not shock the industry at all and in such a way that it benefits the people," said Falah.
While there is full backing from opposition Maldivian Democratic Party (MDP) MPs and while some MDP MPs also said that imposing a tax upon offshore tour operators is required, they also said the actionable procedures need to be proper and looked into.
MP Falah said that even if the amendments to the bill come into force, there will be no increases to amounts due via Maldivian resorts and guesthouses, and instead, what the bill does is impose the same tax on Maldivian businesses onto foreign operators that benefit from Maldives' beauty.
"The beautiful islands, and the rooms and resorts being constructed by Velidhoo Constituency MP Mohamed Abbas and others are being sold by foreign parties without them owing anything to the state. And so, they are to pay due amounts to Maldives Inland Revenue Authority (MIRA) just as how businesses in Maldives do so. Abbas and others have been regularly paying their taxes but those who send guests to their rooms do not pay anything to their nation or to ours. We cannot look past something like this," said Falah.
He also said that opposition MDP MPs are in support of the bill because it is sound.
The purpose of the bill is to add GST regulations to the Income Tax Act for the services provided by offshore booking platforms, foreign tour operators and travel agents. The bill describes these changes as a way to solve the issues within the taxation system and to strengthen it.
If the bill is passed and tax imposed, it is estimated that the state will see an yearly increase of MVR 16 billion, which comes from the MVR 299.3 million from foreign travel agents and MVR 13 billion from foreign tour operators.
