Bill Seeks GST Registration for Foreign Travel Agents and Booking Platforms
- A proposed GST Act amendment would require foreign tour operators, offshore booking platforms and overseas travel agents to register and pay GST on Maldivian tourism services.
- The bill applies the destination principle, taxing services where consumed, and projects MVR 1.61 billion in annual revenue against modest implementation costs.
- Submitted by PNC MP Mohamed Dawood for the Government, the bill is set to take effect 1 October, requiring swift parliamentary approval.
A proposed amendment to the Goods and Services Tax Act could generate more than MVR 1.6 billion a year by requiring foreign tour operators, offshore booking platforms and overseas travel agents to register and pay GST on eligible services supplied in the Maldives.
The bill was submitted to Parliament by PNC MP Mohamed Dawood on behalf of the Government. It seeks to establish a specific legal framework for foreign tourism businesses that sell inbound Maldives travel services without maintaining a permanent place of business in the country.
The proposal applies the destination principle to the tax system, meaning GST would be charged where the relevant tourism services are consumed. It also sets out procedures for foreign booking platforms and travel businesses to charge and collect GST on their Maldivian transactions.
Tourism service providers registered in the Maldives would also be required to issue tax invoices within three days of supplying services under the proposed amendment.
According to the Government’s cost estimate, implementing the changes would require one-time spending of MVR 2.8 million, alongside annual recurrent expenditure of MVR 5.1 million for staffing and operational requirements.
The estimate projects MVR 1.61 billion in annual GST revenue once the Maldives Inland Revenue Authority engages the affected businesses and establishes simplified arrangements for tax registration and payment.
The bill is proposed to take effect on 1 October. Parliament would therefore need to approve it before the current sitting concludes, or during an extraordinary session.
