MMA Governor Calls for Resort Audits as MIRA Defends Risk-Based Tax Checks

Governor of the Maldives Monetary Authority (MMA) Dr. Ahmed Munawar has called for audits to verify whether resort accounts are accurate, prompting the Maldives Inland Revenue Authority (MIRA) to respond to the matter. Speaking at the Parliament's Budget Review Committee, Munawar said that according to figures MIRA shared with the MMA, only about 50 out of 150 resorts are paying income tax. He said audits therefore need to be conducted to check whether the accounts are correct and to see whether the resorts are benefiting. Munawar also said that out of the 5.9 billion dollars that need to enter the country's banking system, only 3.8 billion dollars enters the system. He said ways must be found to ensure that the dollars that should enter the banking system do enter. The Governor said MIRA has a very large responsibility in recovering Business Profit Tax and that the authority needs to be given additional powers for that. In a statement, MIRA said the parties designated by the authority to conduct audits are selected to conduct audits on equal standards within a Compliance Risk Management framework arranged on a "risk-based" approach, while MIRA is also auditing businesses in the tourism sector and businesses in other sectors. "Checking whether taxpayers are computing in accordance with tax laws, and ensuring that taxpayers fulfill their tax obligations in accordance with the tax law, is a legal responsibility being carried out by MIRA," the authority said. "In carrying out this responsibility, rather than looking at the small or large size of the business, applying the law equally among all parties is a principle MIRA has been practicing since its inception." MIRA noted that its work is carried out under a designated strategic plan, in line with a published Compliance Improvement Plan, and said a large percentage of the revenue it receives comes from the tourism sector. The authority said action is being taken against parties who deliberately do not pay tax, under the designated procedure. Under the Tax Administration Act, MIRA's main responsibility is to enforce tax laws, implement tax-related policies, and conduct and manage the work of collecting all taxes legally collected by the state.