Goods and Services Tax Act

Feb 12, 2012   //   by admin   //   Maafushi, Maldives  //  No Comments

1. What is TGST?

Tourism Goods and Service Tax (T-GST) is charged on the value of all goods and services consumed by tourists in tourist establishments in the Maldives. The Tourism Goods and Service Tax Act (Law Number 19/2010) will be repealed from 2 October 2011, i.e. from the date of commencement of Goods and Service Tax Act (Law Number 10/2011).

2. What is GST?

Goods and Service Tax (GST) is a tax imposed on the value of goods and services supplied by a registered business in the Maldives. GST Act will commence from2 October 2011.

3. Whom / What does it apply to?

Pursuant to the GST Act, tax is levied on two major categories, they are;

  • Tourism goods and services
  • General goods and services

The GST on tourism sector applies to all the goods and services sold in tourist establishments. The tax has to be borne by the tourists consuming the goods and services.

The following goods and services are referred as Tourism Goods and Services;

  • Goods and services supplied by tourist resorts, tourist hotels, tourist guest houses, picnic islands, tourist vessels and yacht marinas authorised by the Tourism Ministry
  • Goods and services supplied by diving schools, shops, spas, water sports facilities and any other such facilities being operated on the establishments specified in Section 15(a)(1) of this Act
  • Goods and services supplied by travel agency service providers authorised by the Tourism Ministry
  • Goods and services supplied to foreign tourist vessels entering the Maldives by their agents;
  • Goods and services supplied by domestic air transportation service providers.

4. What is the current rate?

T-GST is levied at 6% as per the T-GST Act.

5. What are the new rates?

Period Tourism goods and services General goods and services
2 October 2011 – 31 December 2011 3.5% 3.5%
1 January 2012 – 31 December 2012 6% 6%
1 January 2013 onwards 8% 6%


6. When does it take into effect?

The effective date of GST Act will be from 2 October 2011.

7. Will there be any changes to this amount in the future?

Any change to the Act can be made by an amendment to the Act passed by the Parliament.

8. How does this affect to the already pre-agreed contracts?

Issues in relation to pre-agreed contracts will be addressed in the Regulations made pursuant to the GST Act, which will be published by the end of September 2011.

9. What is happening to bed tax?

Tourism Tax (bed tax) will be abolished by the end of 2013.


Effective from 1 January 2012, the Government of Maldives has increase its Goods and Services Tax (GST) to 6%, to be levied on all services including accommodation, air transfers, food and beverage, activities and other services. Please read Maldives Inland Revenue Authority (MIRA) Frequently asked questions on GST  for more information.

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