Finance Ministry Establishes System to Offset Taxes Against Government Debts

The Ministry of Finance has established a system to set off taxes payable to the Maldives Inland Revenue Authority (MIRA) against money owed by a state institution or a company in which the government holds shares. In a press release issued by the Ministry of Finance today, it was stated that this process can be carried out when the relevant parties submit requests to MIRA for setting off the money and tax payments due from the government. Under this system, the amount owed for unpaid bills submitted by the smallest, small, and medium-sized businesses can be offset through taxes. According to the ministry, if the amount of tax a business owes to MIRA is greater than the money the government owes to that entity, after setting off the amount due from the government, the remaining balance must be paid by that entity to MIRA as tax. Furthermore, arrangements have been made such that if the money in bills the government owes to such businesses is greater than the tax money they owe to MIRA, the remaining money after setting off the tax amount will be paid by the government to that business. Under this arrangement, the ministry has directed that when submitting a request to set off tax payments, it must be submitted to MIRA along with details of the money, in accordance with the procedures determined by MIRA.