On 5 November 2024, significant amendments to the Tourism Goods and Services Tax (TGST), Green Tax (GRT), and Airport Taxes and Fees (ATF) were ratified, leading to increased tax rates across these sectors. The amendments include:
These changes will be phased in at different times, depending on the specific tax category. Below, we outline the key changes introduced through these amendments, including the effective dates and rate adjustments for each tax type.
1) Goods and Services Tax Act (GST)
The 7th Amendment to the GST Act, which came into effect on 5th November 2024, introduces several important updates, particularly regarding the Tourism Goods and Services Tax (TGST).
Increased TGST Rate
The Tourism Goods and Services Tax (TGST) rate has gradually increased, with the following rates applied over the years:
| Period | Rate |
| October 2011 – December 2011 | 3.5% |
| January 2012 – December 2012 | 6% |
| January 2013 – October 2014 | 8% |
| November 2014 – December 2022 | 12% |
| January 2023 – June 2025 | 16% |
| July 2025 onwards | 17% |
Businesses in the tourism sector must charge 16% TGST on applicable goods and services until 30th June 2025, and 17% TGST from 1st July 2025 onwards to comply with this latest amendment.
Rule for Staff Café’s
Under the initial GST Act, businesses in the tourism sector were required to charge TGST on all goods and services provided within tourist establishments, including those offered exclusively to staff.
However, the 3rd amendment to the GST Act introduced on 1st December 2014 clarified that the staff-only shops were excluded from TGST rate. This meant that these shops should instead charge GST at the general sector rate.
The recent 7th Amendment, ratified on 5th November 2024, has further expanded this exclusion by specifying that cafés exclusively serving staff are also exempt from charging TGST rate.
Therefore, establishments must ensure that the Staff-only cafes and Staff-only shops are now registered within the general sector and charge the standard GST on the general sector rate instead of the TGST rate.
2) Maldives Tourism Act
The 14th Amendment to the Maldives Tourism Act introduces an increase in the Green Tax (GRT) rates effective from January 2025. The new rates are as follows:
| Category | Rates until 31st December 2024 | Rates from January 2025 onwards |
| Tourist Resort, Integrated Tourist Resort, Resort Hotel, Hotel, Tourist Guesthouse and Hotels on uninhabited islands, Tourist Guesthouses and Hotels with more than 50 rooms on inhabited islands, Tourist Vessels, and similar establishments | $6 per tourist per day of stay | $12 per tourist per day of stay |
| Tourist Guesthouses and Hotels with 50 or fewer rooms on inhabited islands. | $3 per tourist per day of stay | $6 per tourist per day of stay |
Additionally, from January 2025, children under 2 years of age will be exempt from the Green Tax.
3) Airport Taxes and Fees Act
The 2nd Amendment to the Airport Taxes and Fees Act introduced changes to both Departure Taxes and Airport Development Fees for travellers from Velana International Airport, effective 1 December 2024.
Departure Tax
The Departure Tax rates for both Maldivian and Foreign Passengers departing from any airport in the Maldives will increase. Exemptions will still apply for passengers with diplomatic immunity, transit passengers, and children under 2 years. The new rates are as follows:
| Class | Maldivian Passengers | Foreign Passengers | ||
| Rates until November 2024 | Rates from December 2024 onwards | Rates until November 2024 | Rates from December 2024 onwards | |
| Economy | $12 | $12 | $30 | $50 |
| Business | $60 | $120 | $60 | $120 |
| First | $90 | $240 | $90 | $240 |
| Private Jet | $120 | $480 | $120 | $480 |
Airport Development Fee
Starting from 1st December 2024, the Airport Development Fee levied on passengers including transit passengers departing from the Maldives via Velana International Airport will increase. Passengers with diplomatic immunities are exempt from this fee as well.
The fee has been increased across passenger categories with the following changes.
| Class | Maldivian Passengers | Foreign Passengers | ||
| Rates until November 2024 | Rates from December 2024 onwards | Rates until November 2024 | Rates from December 2024 onwards | |
| Economy | $12 | $12 | $30 | $50 |
| Business | $60 | $120 | $60 | $120 |
| First | $90 | $240 | $90 | $240 |
| Private Jet | $120 | $480 | $120 | $480 |
Refunds for Incorrect Charges
In the case of incorrect charges of Airport Taxes and Fees, businesses are required to refund passengers if the return has not yet been submitted to MIRA.
If the return has already been submitted and the taxes have been paid to MIRA, once the business has refunded the passenger for the incorrect charges, businesses can subsequently claim the overcharged amount back from MIRA.
Key Action Point