Maldives implements tax reforms and addresses dollar shortage

The Maldives is implementing several legislative and fiscal measures to address economic challenges. The Parliament has passed bills to increase withholding tax for foreign construction contractors to 10 percent, aiming to create a level playing field for local businesses. Additionally, new tax regulations have been approved to collect GST from foreign tour operators and off-shore booking platforms to strengthen the national tax system.

Regarding the ongoing US dollar shortage, former President Abdulla Yameen Abdul Gayoom stated that the issue cannot be solved by silencing public discourse. He suggested that the Finance Minister and the Governor of the Maldives Monetary Authority (MMA) must provide clear solutions to the public. MMA Governor Ahmed Munawwar noted that resolving the dollar crisis requires maintaining macroeconomic fundamentals, such as reducing recurrent expenditure and implementing policies to encourage the use of the Maldivian Rufiyaa.

Fiscal reports indicate that state expenditure on salaries, allowances, and pensions has reached MVR 9.38 billion this year, an 11.2 percent increase compared to the same period last year. This rise is attributed to adjustments in civil service allowances and salary harmonization efforts.