Maldives Moves to Tax Foreign Booking Platforms and Tour Operators

The government has moved to bring foreign booking platforms, tour operators and travel agents into the Maldives’ tourism tax net, with Parliament beginning debate on amendments that would require offshore companies earning revenue from tourist bookings to pay Tourism Goods and Services Tax (TGST).

The government-sponsored bill was introduced to the People’s Majlis by Kulhudhuffushi North MP Mohamed Dawood and proposes changes to existing tax laws to establish a framework for collecting GST from foreign companies involved in selling or arranging holidays to the Maldives.

The proposed amendments specifically target offshore booking platforms, foreign tour operators and overseas travel agents that facilitate bookings for tourists travelling to the Maldives.

According to the bill, the changes are intended to address gaps and practical challenges in the current tax collection system while strengthening the state’s ability to collect revenue generated through tourism-related transactions conducted outside the country.

The proposal could generate significant additional revenue for the state. Estimates included in the bill project around MVR 299.3 million annually from foreign travel agents and MVR 13 billion from foreign tour operators if the proposed taxation mechanism is implemented.

The move signals an effort by the government to capture a greater share of the economic value generated by the Maldives’ tourism industry, including revenue currently earned overseas by companies selling Maldivian tourism products.

During the debate in Parliament on Sunday, lawmakers from the ruling People’s National Congress (PNC) backed the proposal, arguing that the changes would broaden the country’s tax base and ensure that the Maldives receives a fairer share of the revenue earned by foreign businesses through the use and promotion of Maldivian islands, resorts and tourism assets.

The opposition Maldivian Democratic Party (MDP) also expressed support for the principle of taxing foreign tour operators.

However, MDP lawmakers stressed that the mechanisms and procedures used to impose and collect the tax must be carefully reviewed to ensure that the system can be implemented effectively.

If passed, the amendments would mark a significant expansion of the Maldives’ tourism taxation framework, extending tax obligations beyond locally registered tourism businesses to foreign entities that generate revenue from selling holidays and travel services linked to the Maldives.