A proposed reduction in tobacco import duties has moved closer to parliamentary approval, marking a major policy shift from the government’s recent tax-led approach to discouraging smoking.
The Parliament’s Whole House Committee voted on Monday to pass an amendment to the Import-Export Act that would reduce the import duty on cigarettes, beedi and heated tobacco products. The bill proposes cutting the duty from MVR 8 to MVR 4 per stick, while lowering the ad valorem tax from 100 percent to 30 percent.
The amendment, sponsored by Komandoo MP Mohamed Ibrahim, also proposes exempting import duty on products used to help people quit smoking, including nicotine gum and nicotine patches.
The bill was submitted to Parliament on 22 June and sent to the Whole House Committee for review on 24 June. It was passed by the committee on Monday with the unanimous support of 69 lawmakers.
The proposed reduction comes less than two years after President Dr Mohamed Muizzu’s administration sharply raised tobacco taxes. In 2024, the import duty on cigarettes and beedi was increased from MVR 3 to MVR 8 per stick, while the ad valorem tax was raised from 50 percent to 100 percent.
That decision formed part of a wider anti-smoking policy package, which included a ban on vapes and e-cigarettes, as well as a smoking ban for those born after 2007. The measures received international recognition, including a World No-Tobacco Day Special Recognition Award from the World Health Organization for President Muizzu and an Integrity Award from the Global Center for Good Governance in Tobacco Control for the Maldives.
However, the higher duties and vape ban have also been followed by concerns over smuggling and the growth of an illegal market for vapes and cheaper cigarette brands. The government has faced questions over the loss of import revenue and the practical impact of the measures.
During Monday’s committee meeting, lawmakers from the main opposition Maldivian Democratic Party proposed summoning relevant state institutions and assessing the likely impact on the state budget before passing the bill.
Addu Meedhoo MP Abdul Rahman, an independent lawmaker, proposed increasing the duty on beedi by 40 percent and reducing the duty on heated tobacco products by 20 percent. Vaikaradhoo MP Hassan Ziyad, a lawmaker from the MDP, proposed changing the basis for charging duty from per stick to grams.
However, the proposed changes were not submitted in writing, and the committee presidency proceeded to call a vote on the full bill instead of the amendments.
The administration had previously defended the 2024 tax increase, arguing that public health considerations outweighed revenue concerns. However, Homeland Security Minister Ali Ihusan said at a press briefing on 31 May that the decision to double cigarette taxes had been difficult, and that the administration was considering reducing the duty to MVR 4 per stick.
He also said the change had been recommended by the World Health Organization. The WHO has not issued an official comment on that claim.
When asked about the matter on 1 June, President Muizzu said the proposed change did not amount to a reversal of his position on tobacco control, but formed part of what he described as necessary adjustments.
