The Parliament has approved changes to the Special Economic Zones (SEZ) Act, allowing the Government to create new zones aimed at attracting large-scale foreign investment.

The amendment passed with 46 votes in favour. It was submitted on behalf of the Government by Baarah MP Ibrahim Shujau and reviewed by the Whole House Committee before its approval.

One of the key changes allows the state to charge a four per cent property transfer tax on the total value of villas or rooms in tourist resorts or integrated tourist resorts leased for long periods.

The revised law also introduces the concept of a “sustainable township” – a large real estate or integrated tourism project located within a single zone and designed to provide sustainable infrastructure, services, and utilities.

To qualify for an SEZ permit, investors must commit to a minimum investment of USD 500 million. Developments may include luxury tourism facilities, large-scale real estate projects, hospitality training centres, or international healthcare institutions.

The bill offers a range of incentives to encourage investment, including reduced income tax rates of five per cent for the first ten years and ten per cent for the following decade. Import duties on capital goods used for development will also be exempt.

The Government says the changes are designed to attract foreign capital, diversify the economy, and promote sustainable development across the Maldives.