Tourism tax hike bills sent to sub-committee for review

Two bills proposing tourism-related tax hikes have been forwarded to a sub-committee of Parliament’s Public Accounts Committee and Economic Affairs Committee.

The bills were initially sent to the Whole House Committee for review. Due to contradicting opinions among committee members, PNC’s parliamentary group leader Ibrahim Falah proposed to forward the bills to a sub-committee for review.

The government-proposed bill to amend the Tourism Goods and Services Act was forwarded to the sub-committee with the unanimous votes of 62 MPs in attendance.

The government-proposed bill to amend the Airport Taxes and Fees Act was also forwarded to the sub-committee with the unanimous votes of 62 MPs in attendance.

The amendment to the Tourism Goods and Services Act proposed to raise the Tourism Goods and Services Tax (TGST) from 16 percent to 17 percent starting from next year’s June.

Despite support for the hike, several MPs from ruling PNC expressed concern over the date the tax hike will come into effect.

The bill was accepted to the Parliament with the votes of 52 MPs. Seven MPs voted against accepting the bill.

Meanwhile, the amendment to the Airport Taxes and Fees Act proposes to increase the Airport Departure Tax and the Airport Development Fee from USD 30 to USD 50 for foreign ‘economy class’ passengers, from USD 90 to USD 120 for both local and foreign ‘business class’ passengers, from USD 90 to USD 240 for ‘first class’ passengers, and from USD 120 to USD 480 for passengers who depart of private jets.

The changes are designed to take effect on December 1, 2024.