The Maldives Inland Revenue Authority (MIRA) has raised the Tourism Goods and Services Tax (TGST) rate to 17 per cent.

TGST is a sector-specific tax applied to the tourism industry, including resorts, hotels, guesthouses, safari vessels, dive centres, spas, and other related services.

The revision, introduced through the Seventh Amendment to Act No. 10/2011 (the Goods and Services Tax Act), increases the TGST rate from 16 per cent to 17 per cent.

According to MIRA, the revised rate applies to all transactions for which the “time of supply” occurs on or after 1 July.

MIRA has urged tourism businesses to make the necessary preparations and apply the revised 17 per cent TGST rate to all goods and services starting from 1 July.

Alongside the tax rate revision, the amendment also broadens sector-specific exemptions. Previously, only shops catering exclusively to tourism workers were exempt from being classified as providers of tourist goods or services. 

The updated law now extends this exemption to staff-only cafés, further accommodating services intended solely for tourism industry employees.

Parliament passed the Seventh Amendment to the Goods and Services Tax Act on October 31, 2024.