A bill proposing to the amend the Export and Import Act of Maldives to abolish the 5 percent duty on diesel was submitted to the parliament on Tuesday.
The amendment will abolish import duties on diesel used on fishing vessels and burnt in diesel generators to produce electricity. Currently, the State Electric Company (STELCO) and Fenaka Corporation provide electricity services in Maldives.
The purpose of the amendment, according to Thimarafushi MP Mohammed Musthafa who proposed the bill, is to reduce electricity rates and costs incurred by fishermen.
The amendment must be passed by the parliament, ratified by the president and published in the government gazette before it is implemented. Maldives Customs Service must also approve the amendment.
A 10 percent import duty on diesel and petrol was introduced by former president Abdulla Yameen Abdul Gayoom. This was cut down to 5 percent in June 2017, which subsequently reduced fuel prices.
The abolishing of duty levied on diesel used by fishermen is a pledge by President Ibrahim Mohamed Solih. His 100 day action plan include abolishing the duty on diesel within a month.
The MVR 30.2 billion budget passed for 2019 allocates MVR 272 million to reduce electricity rates.