Bill to Amend Income Tax Act Tabled in Parliament, Projected to Boost State Revenue by MVR 496 Million

The government has submitted to the People's Majlis a bill to amend the Income Tax Act, with the first reading held during today's session. The bill was presented by Hassan Waeed, Member of Parliament for Vilufushi constituency, on behalf of the government. The proposed amendments aim to revise the rules for deducting interest when calculating taxable income, introducing an interest deductibility cap at 25% of a taxpayer's tax-EBITDA for the relevant period. The bill also proposes the removal of certain provisions in the current law. The government projects that the amendments will increase state revenue, estimating an additional MVR 496,300,302 in income tax revenue. The bill is proposed to take effect from 1 January 2027.