Parliament has passed the amendment to the Foreign Currency Act where 40 percent of the revenue generated in foreign currency by resorts and guesthouses is to be exchanged at banks every month.
The bill where businesses that generate revenue in foreign currencies have to exchange their earning that will see their category raised was submitted on behalf of the government by Holhudhoo Constituency MP Abdul Sattar Mohamed, with Funadhoo Constituency MP Mohamed Mamdhooh submitting an amendment that makes it mandatory for Category "A" businesses (resorts) to exchange 40 percent of their total revenue at banks.
As per the bill, the stated businesses will have to exchange 40 percent of their total revenue at banks from 1st September onwards.
47 out of the 59 MPs in attendance during today's Parliament sitting voted in favor of the bill.
12 opposition Maldivian Democratic Party (MDP) MPs voted against passing the bill.
While the bill has been passed in Parliament, the Maldives Association of Tourism Industry (MATI) stated on 24th August that exchanging 40 percent of their USD revenue is not something they can do as resorts rely quite heavily on USD to provide services and other matters.
In a statement written by MATI, they said that exchanging 40 percent of their USD revenue is not a viable amount for the industry as resorts use USD to pay salaries, service charges, taxes (Tourism Goods and Services Tax (TGST), Green Tax, Withholding Tax and Income Tax), rent and loans that need to be paid in foreign currency.
Even if an investigation has alleged that some resort operators have conducted illegal transactions which facilitates foreign currency prices rising on the black market, MATI said that they have not received any information regarding such an activity. The statement also reads that MATI has always urged all resort operators to fully comply with laws and regulations.
MATI's statement further reads that taking steps against the entire industry while conducting an investigation into a few resort operators and accusing resorts of running the USD black market is not fair.
The statement outlined MATI's concern regarding the government preparing to submit an amendment to the Foreign Currency Act to the Parliament, specifically making it mandatory for Category "A" businesses (resorts) to exchange 40 percent of their total revenue at banks.
