At present, the standard rate for Value-Added-Tax (VAT) in the Maldives is 6%. In addition to being the Standard Rate, it is also the General and the Most Common tax. But the VAT rate is not the same for all products and services, with some services being subjected to a higher rate than others.
Furthermore, Maldives is highly dependent on tourism generated revenue. The country benefits from the fact that it is geographically dispersed over hundreds of islands and has breathtaking sea views and sceneries to offer. Also, 5% of the total tax revenue is generated from Green Tax, which is 6 US dollars per night tax on tourists.
Vat Calculator Maldives
Calculating VAT Manually for the Maldives
Either you want to add tax into an amount or remove it; there are simple formulas. We have generated the online Calculator for your ease, which would take less than a second to calculate your results. On the other hand, VAT can also be calculated manually using simple formulas for the addition and subtraction of VAT.
History of VAT in the Maldives:
MIRA (Maldives Inland Revenue Authority) implemented VAT in the Maldives, on October 2, 2011, at a rate of 3.5% in general, which later increased to 6% in 2012. There is a distinction in rate for general goods and services tax (GST) and tourism-related goods and services tax (TGST). In 2013, TGST rose to 8% and finally rested at 12% on November 1, 2014, while GST remained at 6%.
Maldives VAT Rules and Regulations
Since Tourism Goods and Services Tax are treated differently under the GST Act of Maldives, the following rules are significant:
- Every business must register to GST when its turnover exceeds 1 million MVR.
- Under the category of the tourism sector, businesses must register to GST even if the threshold does not reach 1 million MVR per annum.
The distinction elaborates on how the tourism sector’s Revenues occupy a big space of Maldives’ economy.
Products and Services Exempted from VAT in the Maldives:
There are certain products and services exempted from GST. However, they are to get registered as usual, but they are termed as 0%. The products and services include:
- Edible items; eggs, sugar, oil, milk, fruits of all types, etc.
- Fuel, gas, diesel, and power supplies are used for cooking.
- Baby food and baby diapers.
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Q: What is GST in the Maldives?
Currently, there is a 6% GST rate for goods and services in the Maldives.
Q: Is Maldives Tax-Free?
Foreigners working in the Maldives are exempt from income tax, while expatriates are subjected to a 3% remittance tax.
Q: How GST is calculated in the Maldives?
Let’s suppose we have an amount of 25,000, then the Price of VAT is (25000*6)/100 = 1500, and the Net Price is 25000+1500 = 26,500.
Q: What are the taxes in the Maldives?
For companies with income over 500,000 MVR, the tax rate is 15%, while for the companies that are getting their profits from outside, the tax rate is 5%.
Q: Do Resident Permit Holders have to pay Green Tax in the Maldives.
No, Resident Permit Holders and Maldivians don’t have to pay green tax.