Parliament passes amendment to exempt Maldivians from T-GST

Parliament today passed an amendment to the Goods and Services Tax Act to exempt domestic air travel and goods sold at shops in resorts, guesthouses, and hotels exclusively for staff from the Tourism Goods and Services Tax (T-GST).

The amendment submitted by Maldives Development Alliance MP Mohamed Ismail was passed unanimously with 72 votes in favour.

However, the amendment bill does not exempt foreign labourers and tourists from T-GST on domestic air travel or ticket prices.

Following ratification by the president, Maldivians would be charged a six percent GST on airfare.

A T-GST hike from eight to 12 percent – approved by parliament in February as part of revenue raising measures proposed by the government – came into effect on November 1.

Subsequently, local airlines Maldivian and Flyme imposed a 12 percent sales tax on ticket prices and increased airfare by about MVR32 per ticket.