· Offshore booking platforms must register with MIRA to pay tax
· System established to collect tax from entities registered overseas
The Maldives has begun implementing the eighth amendment to the Goods and Services Tax (GST) Act, introducing the destination principle for tourism-related services supplied in the Maldives.
The amendment, aimed at further strengthening the country’s tax system, will take effect after the regulations required under the amended law are formulated, following which MIRA will provide opportunities for the relevant businesses to register through the authority.
Under the amendment, provisions have been introduced to impose GST on services supplied to offshore booking platforms, foreign tour operators and travel agents based on the value of goods and services they provide in connection with tourism in the Maldives.
According to the amendment, if a service is provided by a party to a business operating in the Maldives, that service will be treated as a service supplied in the Maldives.
Even if the party receiving the service is not registered in the Maldives, a service will be regarded as having been supplied in the Maldives if, at the time the service is provided, the supplier carries out the practical work related to that service in the Maldives or if the service is related to immovable property located in the Maldives.
The amendment also includes the supply of an inbound tourism product in the Maldives among the activities subject to GST, even where the business providing the taxable service does not have a permanent place of business in the Maldives.
An inbound tourism product is defined in the legislation as tourism-related activities such as accommodation, food and transportation provided in the Maldives.
The amendment is intended to address difficulties encountered in implementing the GST system and further strengthen the country’s tax framework.
Under the amendment, businesses registered outside the Maldives that provide various tourism services in the country will be required to pay GST at the tourism sector rate of 17 percent. MIRA has opened registration for such businesses.
Following registration, procedures for filing GST returns and making GST payments have also been established. In addition, MIRA has arranged a system through its online platform to facilitate GST-related procedures and has provided a dedicated email address and WhatsApp number for these businesses to obtain and provide information.
MIRA has stated that the amendment to the GST Act will not change the procedures currently followed by businesses that are already paying tax, nor will it change the amount of tax they are required to pay.
The government has also estimated the additional revenue expected to be generated through the amendment. Once tax collection begins from offshore booking platforms, foreign tour operators, travel agents and other entities that provide services in the Maldives without maintaining a permanent place of business in the country, government revenue is expected to increase by approximately MVR 1.6 billion annually.
The tourism sector GST rate is currently 17 percent, following the increase from 16 percent effective July 1, 2025.
