The People’s Majlis has voted down a motion calling for changes to the Goods and Services Tax (GST) framework that would exempt businesses from paying GST on unpaid invoices.

The motion, submitted by Keyodhoo MP Mohamed Niushad of the Maldivian Democratic Party (MDP), sought to address concerns raised by small and medium enterprises over the requirement to pay GST once an invoice is issued, regardless of when, or if, payment is received.

MP Niushad argued that this practice places undue financial pressure on businesses, especially when payments are delayed by clients, including state-owned companies. He warned that the current law may result in economic setbacks, reduced cash flow, and job losses, describing the situation as unsustainable for many service providers.

Under Article 17(a) of the GST Act, tax is payable at the point a tax invoice is issued or when partial payment is received. Businesses have criticised this rule, saying it forces them to remit tax without having received the corresponding income, potentially leading to penalties and being blacklisted by state institutions.

In the parliamentary vote, 36 members opposed the motion while 11 supported it, including 10 MDP MPs and one independent member. As a result, the motion was rejected and will not proceed to debate.