News Desk
President Dr. Mohamed Muizzu on Monday ratified a sweep of significant legislation previously passed by the People’s Majlis, reforming the allocation of islands, setting new standards for land transport, imposing steep penalties on black-market foreign exchange activity, and extending Goods and Services Tax (GST) requirements to foreign tour operators.
The legislative measures were formally signed into law during a ceremony hosted at the President’s Office in Malé.
Executive Authority Over Uninhabited Islands
Under the newly enacted framework governing uninhabited islands and lagoons, the President holds direct authority over the designation, allocation, and oversight of state-owned land for commercial, industrial, agricultural, and social developments. The law grants executive power to set island-use mandates, determine maintaining state institutions, and revoke or reassign island leases for public purposes.
Set to take effect on October 1, the law establishes standard lease terms of up to 21 years, with provisions allowing relevant ministries or local councils to extend leases up to 50 years. Minimum annual lease rates per square meter have been fixed at:
- MVR 3.00 for industrial and economic projects
- MVR 2.50 for agriculture and fisheries
- MVR 2.00 for social developments
- MVR 0.50 for lagoon leases utilized for fisheries
To maintain oversight, the statute mandates that island lease schedules and details be regularly shared with the Anti-Corruption Commission (ACC) and the Auditor General’s Office.
Land Transport Overhaul and 20-Year Vehicle Cap
The President also signed the Land Transport Act, introducing a comprehensive regulatory standard designed to increase road safety and modernise oversight across the country.
Under the new law, land vehicles—excluding specifically exempted categories—will face an operational lifespan limit of 20 years from their date of manufacture. The law introduces a demerit point system, provisions for driver’s license suspensions, and allows authorities to suspend licenses over unpaid transport fees or fines exceeding MVR 5,000.
Additionally, the act mandates the issuance of International Driving Permits for local motorists travelling abroad, while recognizing valid licenses from signatories of international traffic treaties for operation within the Maldives without extra local permits. Administration of the transport system will remain under the transport ministry, supported by a newly established Road Safety and Traffic Management Advisory Committee and a dedicated Greater Malé Transport and Mobility Office.
Crackdown on FX Black Market Rates and 40% Resort Dollar Remittance
Addressing ongoing currency challenges, President Muizzu signed the Foreign Exchange Bill, directly prohibiting the publication, advertisement, or promotion of parallel market foreign exchange rates above official rates set by the Maldives Monetary Authority (MMA).
The legislation, originally sponsored by Holhudhoo MP Abdulla Sattar Mohamed, underwent key revisions in the Majlis Public Accounts Committee. Moving away from a prior proposal requiring resorts to surrender $500 per tourist, the final law mandates that resort businesses convert 40 percent of their monthly foreign currency earnings into domestic banks.
The law institutes heavy financial penalties for publishing black-market rates across digital or print mediums:
- Individual Fines: MVR 25,000 to MVR 500,000
- Corporate Fines: MVR 100,000 to MVR 5,000,000
Law enforcement agencies retain the authority to pursue separate criminal charges if illegal currency operations breach existing penal codes. The measure takes effect immediately.
GST Extended to Offshore Platforms and Tour Operators
Amendments to the Goods and Services Tax Act were also signed into law, applying the destination principle to foreign travel agencies, offshore booking platforms, and inbound tour operators selling Maldivian tourism products.
Even without a physical presence or permanent establishment in the country, foreign entities providing local accommodation, transport, or dining services are now legally required to collect and remit GST. Passed by the Majlis on August 23, the tax amendment takes effect in October and is projected by state financial authorities to generate MVR 1.6 billion annually in additional revenue.
