MIRA Rejects Governor Munawar's Claim, Says Audits Are Fair and Risk-Based

The Maldives Inland Revenue Authority (MIRA) has responded to comments made by the Governor of the Maldives Monetary Authority (MMA), Ahmed Munawar, stating that its auditing practices are applied equally and are not based on the type or size of a business. In a statement issued today, MIRA said its main responsibilities under the law are implementing tax laws, running tax-related policies, and managing and overseeing the collection of all taxes taken by the state. The authority said that checking whether taxpayers calculate tax in accordance with the laws, and ensuring that those who pay tax fulfil their obligations, is a legal responsibility carried out in that manner. "...In carrying out this responsibility, instead of looking at the type and size of the business, implementing the law equally among all parties is a principle MIRA has been acting upon since its inception," the statement said. The authority also said it is working in accordance with a Compliance Improvement Plan that has been determined and made public. MIRA said the parties it determines to audit are selected by equal principles within a compliance risk management framework arranged on a "risk-based" principle. "...In this manner, MIRA is auditing businesses in the tourism sector and businesses in other sectors as well. And, we also note that a large percentage of the income MIRA receives comes from the tourism sector," MIRA said. The authority said ease of arrangements have been established for small businesses within the tax system, including in keeping accounts, auditing, and submitting tax statements. MIRA said its work is structured around increasing tax compliance by providing, in association with businesses, the assistance they need, but that action is being taken under determined principles against those who intentionally do not pay tax. MIRA issued the statement after Governor Munawar said yesterday that MIRA is not only to go after shops on the second floor, and that to solve the dollar issue, resorts also need to be audited. Responding to a question at a meeting of the People's Majlis Budget Committee, the Governor said that while the tourism industry receives USD 5.9 billion a year, USD 3.8 billion of that enters the Maldives' banking system. He said every dollar the Maldives receives must enter the banking system, and that extensive monitoring is now being carried out. Responding to a question by the Member for Hulhumalé South Constituency, Dr. Ahmed Shamheed, on the difficulty in obtaining dollars, Governor Munawar said that although collecting tax on business profit is the responsibility of MIRA, there are many resorts that do not pay that tax.