MDP against “double taxation” of tourism industry

The opposition Maldivian Democratic Party (MDP) is against the government’s plans to reintroduce the tourism bed tax and hike the Tourism Goods and Services Tax (T-GST) from eight to 12 percent, parliamentary group leader Ibrahim Mohamed Solih has said.

“We won’t agree to double taxation in tourism industry,” he was quoted as saying by newspaper Haveeru.

Solih told local media that the MDP was also against raising import duties. A parliamentary group meeting will be held to decide the party’s stance on the government’s bills, he said.

An extraordinary sitting of parliament has meanwhile been scheduled for tomorrow – during the ongoing two-month recess – to debate government-sponsored legislation to raise the T-GST and amend the Tourism Act.

Amendments to the tourism law are intended to revive 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.


2 thoughts on “MDP against “double taxation” of tourism industry”

  1. a property tax would be a good idea , just measure the m2 of the buildings/land owned by people and tax accordingly.

  2. The main problem with the bed tax is that it hits the guest houses disproportionally harder -

    $8 on a $50 room = 16% tax

    $8 on a $750 room = just 1% tax

    But of course this is what certain peoples want - the closure of the local island guest houses, so they can control the industry & the profits, and hire the islanders themselves for low wage.

    To relax the industry is to liberate the people from the rich business tycoons.

    But the tycoons speak of "protecting Maldivian culture" and "defending Islam" and tell of the "chaos" that will abound if foreigners are allowed to mix with the small-minded uneducated local peoples... All the while the tycoons travel first class to Singapore and Bangkok to have meetings with the foreigners and enjoy the wine and the ladies...


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