President’s Office informs parliament that bill to increase GST will be submitted

The President’s Office, on Wednesday, has informed the Parliament that the government will be submitting 30 bills for the third session of the year, including the bill to increase Goods and Services Tax (GST).

A list of bills planned for submission to the parliament by the government for the third session of the year was sent to the parliament today.

The list comprising of 30 bills including Bill to Amend Criminal Procedure Code, Bill to Amend Judges Act, Bill to Amend Tourism Act, Health Services Bill, Hajj and Umrah Bill and Bill to amend Decentralization Act. From the 30 bills – the Bill to Amend Goods and Services Act, is, however, the one that has sparked criticism from the public.

The government recently unveiled measures which will be taken to decrease state expenditure and increase state revenue in order to improve the fiscal situation of Maldives in early July.

In this regard, the measures announced to increase state revenue was to raise GST from 6 percent to 8 percent and TGST from 12 percent to 16 percent.

The government plans to implement these changes within the next six months.

The public expressed enragement subsequent to news of the government initiating discussions with stakeholders on increasing GST and TGST. Criticizing the government’s course of action, Parliament Speaker, former President Mohamed Nasheed said that debt restructuring and cutting down operational costs would improve the fiscal situation without increasing taxes.

GST and TGST are two great sources of income for the government. Should these taxes be increased, prices of goods and services will hike further during a period of time prices continue to increase in the global market.

However, Finance Minister Ibrahim Ameer in announcing the decision to increase GST and TGST said that more difficulties will arise in the future if swift action is not taken to improve the financial situation of the state.

In this regard, measures announced by the government to decrease expenditure includes reforming subsidy, decreasing state-owned companies’ dependency on state budget, slowing down the commencement of additional projects and controlling operational costs.