The Edition


Maldives slaps expats with remittance tax

Mohamed Visham
17 August 2016, MVT 15:43
An expat worker pictured at the local market in the capital Male. MIHAARU PHOTO/MOHAMED SHARUHAAN
Mohamed Visham
17 August 2016, MVT 15:43

Parliament on Wednesday an amendment for the Employment Act to impose a three percent remittance tax on expatriate workers and obligate employers to deposit expat remuneration in banks.

The government proposed amendment was passed with 41 lawmakers voting in favour out of the 66 present during Wednesday's sitting.

The Bill states that all remuneration and allowances paid by employers to expatriate workers with work visas, or unregistered workers, must be deposited in accounts under the employees’ name at a registered bank in the Maldives.

Employers that do not deposit the salaries of their expatriate employees in banks will be penalised between MVR 10,000 – 50,000. The amendment also authorises the state to terminate services to employers that violate this Act.

The members of parliament had unanimously conceded to impose a three percent tax on expatriates’ remittance during the debate. However, a number of parliamentarians had dissented its implementation without an integral procedure to collect the tax.

Pro-government members further asserted that the remittance tax and deposition of expatriates’ salaries in banks will provide some solution to the predicament of unregistered expatriates.

According to Maldives Immigration’s official statistics, there are over 100,000 expatriates currently working in the Maldives. The statistics estimate unregistered expatriates to number 20,000.

The government’s proposed state budget for 2016 projects MVR 56 million as revenue from remittance tax this year.