Extraordinary sitting of parliament called off

Today’s extraordinary sitting of parliament was called off without debating the government’s revenue raising measures after opposition Maldivian Democratic Party (MDP) MPs objected to the proposed tax hikes and alleged obstruction of the upcoming local council elections.

With MDP MPs taking consecutive points of order, Speaker Abdulla Shahid adjourned proceedings 15 minutes into the sitting, stating that he would consult the majority and minority leaders.

After the sitting resumed at 1:50pm, Shahid said that discussions with party leaders were “regrettably not that successful” and attempted to proceed with the debate on government-sponsored legislation for raising revenue.

However, MDP MPs continued to raise points of order and Shahid brought the sitting to a close at the end of normal time.

Today’s sitting was held during the ongoing recess upon request by 27 government-aligned MPs stating that failure to pass the revenue bills during the last session of 2013 was hampering implementation of the budget.

The three bills submitted by the government include an amendment to the Goods and Services Tax Act to raise T-GST from eight to 12 percent as well as two amendments to the Tourism Act intended to reintroduce the discontinued flat US$8 bed tax and require resort lease extensions to be paid as a lump sum.

Following the Majlis’s failure to extend the tourism bed tax before the end of last year, Finance Minister Abdulla Jihad told local media that the resulting losses to state revenue would be MVR100 million a month.

Among other revenue raising measures proposed by the government include revising import duties, raising airport departure charge for foreign passengers from US$18 to US$25, leasing 12 islands for resort development, and introducing GST for telecommunication services.

In December, parliament passed a record MVR17.5 billion (US$1.16 billion) budget for 2014, prompting President Abdulla Yameen to call on the legislature to approve the revenue raising measures, which the government contends are necessary to finance development projects.

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