Maldives Inland Revenue Authority

Income Tax is levied under the Income Tax Act (Law Number 25/2019). The act was published in the Government Gazette on 17 December 2019 and taxation under the act is set to commence on 1 January 2020. However, remuneration will come within the purview of income effective 1 April 2020. The Business Profit Tax regime imposed under the Business Profit Tax Act would be repealed with the commencement of Income Tax.

Tax residents of Maldives are taxed on their worldwide income, whereas non-residents are taxed on the income derived from Maldives.[4] The Income Tax Act covers income received through conducting business, employment income, and banking.

The Tourism Goods and Services Tax (T-GST) Act[5] came into effect on January 1, 2011. Under the Act, T-GST is charged on the value of goods and services supplied by tourist resorts, tourist hotels, guest houses, picnic islands and tourist vessels, and on certain other services supplied by places providing services to tourists in the Maldives. The tax rate under the Act was 3.5%. The T-GST Act was abolished following the commencement of the Goods and Services Tax Act.

In October 2011, the T-GST regime was repealed and replaced by the Goods and Services Tax (GST) Act.[6] The GST Act came into effect on 2 October 2011, and expanded the tax to all sectors of the economy. The Act imposed a GST at the rate of 3.5% from 2 October 2011 to 31 December 2011 and 6% from 1 January 2012 to 31 December 2012. The GST rate on “tourism goods and services” increased to 8% on 1 January 2013 and to 12% on 1 November 2014.

Following the COVID-19 pandemic GST rates were revised upwards from 1st January 2023. The current rates are 16% for the tourism sector and 8% for the general sector.[7]

The Business Profit Tax (BPT) Act[8] came into effect on 18 July 2011. Under the Act, tax is imposed at the rate of 15% on profits exceeding MVR 500,000 (approx. USD 32,425) in a tax year. A lower rate of 5% is applicable to companies resident in the Maldives generating all of their income from outside the Maldives. Further, if any payment specified in Section 6 of the Act is made by a business to a non-resident, a withholding tax at the rate of 10% is imposed on the gross amount of such payment.

Green tax is a tax payable by tourists who stay in tourist resorts, tourist hotels and tourist vessels. It is also payable by tourists who stay in tourist guesthouses from 1 October 2016 onwards. Green tax is payable at the rate of 6 United States Dollars per day of stay from tourist resorts, tourist hotels and tourist vessels. A lower rate of 3 United States Dollars per day is charged for tourist guesthouses and hotels on local islands that have less than 50 rooms.[9] Maldivians and resident permit holders are not required to pay Green Tax.

Banks operating in the Maldives are required to pay 25% of taxable profit as Bank Profit Tax.[10] Banks are exempt from paying Business Profit Tax. The Business Profit Tax Act was repealed with the commencement of the Income Tax on 1 January 2020.[11]

This Act prescribes all matters relating to the levying of Airport Service Charge as a tax and Airport Development Fee as a fee, on passengers departing from the Maldives from an airport in the Maldives.[12] Airport Service Charge (ASC) is levied on passengers departing from the Maldives from an airport in the Maldives, at a rate of US$25 per foreign passenger and US$12 per Maldivian passenger. Persons with diplomatic immunity, transit passengers and children under the age of 2 are exempt from ASC. Airport Development Fee (ADF), in addition to ASC, will be levied on passengers departing from Velana International Airport on or after 1 May 2017, at a rate of US$25 per foreign passenger and US$12 per Maldivian passenger. Only passengers with diplomatic immunity are exempted from ADF.

The Commissioner General of Taxation shall carry out the functions of the Commissioner General of Taxation as prescribed in the Tax Administration Act and in any other tax law, and oversee the day-to-day administration of the MIRA.[13] On 2 August 2019, Mr. Yazeed Mohamed was appointed as the first Commissioner General of Taxation. The current Commissioner General of Taxation is Mr. Fathuhulla Jameel, and was appointed on 31 October 2019.

The functions of the Deputy Commissioner General of Taxation shall include discharging the duties of the Commissioner General of Taxation in the event that the Commissioner General is unable to attend to the work of the MIRA, and carrying out any other work determined by the Commissioner General.[13] Mr. Hassan Zareer was appointed as the first Deputy Commissioner General of Taxation on 2 August 2019. The current Deputy Commissioner General of Taxation, Ms. Asma Shafeeu, was appointed on 31 October 2019.