News Desk
MALE’ — The People’s Majlis has passed legislation requiring foreign online travel agencies and tour operators to pay tourism goods and services tax on bookings they handle for the Maldives, a move the government says could bring in roughly MVR 16 billion in additional annual revenue.
The bill, submitted by Kulhudhuffushi North MP Mohamed Dawood on behalf of the government, passed 54 votes to 2, with only Hanimaadhoo MP Abdul Ghafoor Moosa and Keyodhoo MP Mohamed Niushad voting against.
The amendment brings offshore booking platforms and foreign tour operators within the Maldivian tax framework for the first time. International online travel agencies have for years collected large commissions on resort and guesthouse bookings while paying little or no tax to the Maldivian state, a gap that MIRA has previously flagged as a concern.
Under the change, the full booking value transacted by foreign operators will be subject to TGST, currently set at 16 percent for the tourism sector. The government estimates foreign travel agents will contribute MVR 299.3 million annually, with foreign tour operators adding a further MVR 13 billion, bringing the projected total to MVR 16 billion.
The bill was passed by the committee of the whole Majlis with clarifying amendments to the definition clauses, proposed by Thulusdhoo MP Ibrahim Naseem.
PNC members described the legislation as a long overdue step to ensure Maldivians receive a fair share of the profits foreign companies extract from the country’s natural resources. Critics of the current system have long pointed out that platforms like Booking.com and Expedia earn substantial fees from Maldivian properties while the state sees none of it in tax.
Whether enforcement against foreign platforms will be straightforward is a separate question the legislation does not fully answer.
