Welcome to the Maldives Tax Newsletter where you will find highlights from national developments in tax law and policy.

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Tax News

Image depicting the tourism sector goods and services tax rate of 17% effective from 01 July 2025 and the previous goods and services tax rate of the tourism sector from 01 Jan 2023 until 30 June 2025. — New TGST Rate Comes into Effect

On 01 July, the new tourism sector goods and services tax rate of 17% came into effect.
This change was brought about by the *Seventh Amendment to the Goods and Services Act* ratified in November 2024. Read more about tax rate changes brought into effect from 2024 to 2025 here.

Tax Cases

Tax Appeal Tribunal Rules on Highly Contentious Procedural Issue in Tax Audits

On 01 July, the Tax Appeal Tribunal (Tribunal) passed its judgement in Amin Construction Private Limited v Maldives Inland Revenue Authority [TAT-CA-B/2023/025,026,027]. The case concerned the legal validity of the tax audit notices served by MIRA to the appellant. In its judgement, the Tribunal highlighted the following:

While the audit notice does not state the subsection that it was served under, the scope of the audit had been made clear to the appellant as an investigation notice that states the suspected offence had been served to the appellant.
Audit notices for business profit tax audits shall be served under the Business Profit Tax Act (BPT Act) as the special act precedes the general act (Tax Administration Act).
The audit notices were sent before the statutory deadline stated in Section 20(g) of BPT Act.
As the audit notice for tax year 2014 had been sent after the statutorily required five-year record-keeping period, MIRA cannot take any administrative action against the appellant.

Conclusion

Thank you for reading this edition of our newsletter. We hope you found the updates valuable. If you have any questions or would like any further information, please do not hesitate to contact us.

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