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Galolhu Uthuru MP Mohamed Ibrahim has written to Speaker Abdul Raheem Abdulla requesting an immediate Public Finance Committee review and delay of the new 17 percent destination-based GST on foreign travel agencies.
News Desk
Galolhu Uthuru MP Mohamed Ibrahim (Kudu) - Photo: Majlis
MALÉ: Galolhu Uthuru MP Mohamed Ibrahim (Kudoo) has requested Speaker of Parliament Abdul Raheem Abdulla to intervene and halt the upcoming implementation of the 17 percent Goods and Services Tax on foreign booking platforms and travel agencies.
The proposal comes from the main opposition Maldivian Democratic Party (MDP) lawmaker as concerns grow across the tourism industry.
In an official letter sent today, the MP urged the Speaker to direct the Public Finance Committee to review the 8th Amendment to the GST Act before enforcement begins next month. The lawmaker stated that Parliament has a responsibility to protect international market confidence and pointed out that the amendment was passed without conducting proper economic impact assessments, market risk analyses, or feasibility studies.
The letter cited key findings from a report by industry group ‘Destination Future’, which warned that introducing new taxes while resort occupancy rates are already falling poses serious commercial risks. The report highlighted that enforcing tax collection on foreign markups and charter flights is practically impossible for MIRA to verify. Furthermore, industry experts warned that if major foreign operators shift their business to competing destinations, recovering those lost markets will prove extremely difficult.
To safeguard the tourism sector, Destination Future recommended suspending the tax clause, forming a ‘National Tourism Growth and Review Working Group’, and focusing on increasing tourist arrivals naturally during the upcoming ‘Visit Maldives Year’.
Estimated Government Tax Revenue Target: MVR 1.6 billion annually from the offshore tax levy.
Current Operating Resorts: 165 resorts nationwide with additional properties under active development.
Projected Impact on Tourist Arrivals: Estimated 3 percent drop in overall tourist arrivals to the Maldives.
Proposed Industry Solution: Forming a National Tourism Growth and Review Working Group ahead of Visit Maldives Year.
