Bill to Tighten GST Enforcement Submitted to Maldivian Parliament

A bill amending the Goods and Services Tax (GST) law has been submitted to the Maldivian Parliament, aiming to strengthen measures against those who fail to pay the tax. The amendment, introduced by MP Ibrahim Didi of Kolamafushi constituency on behalf of the government, was given its first reading during Monday's sitting. The bill seeks to halt the collection of GST on inbound tourism products and services provided by businesses without a permanent establishment in the Maldives, a practice that had been slated to begin on 1 October 2026. It also aims to reinforce enforcement actions available to the Maldives Inland Revenue Authority (MIRA) against non-compliant entities. Under the proposed changes, the Commissioner General of Taxation would gain the power to disregard transactions considered to be for the purpose of obtaining a tax benefit, effectively treating them as tax avoidance arrangements. The bill outlines specific indicators of such benefit-seeking, including cases where the amount of GST payable is reduced or the payment deadline is delayed. The bill will come into effect upon passage, ratification, and gazetting. Notably, the explanatory notes acknowledge that with the amendment, the state will no longer receive the previously anticipated revenue from offshore booking platforms and foreign tour operators, which was estimated at 1.6085 billion rufiyaa.