The Tourism Goods and Services Tax (TGST) on the tourism sector has been approved for an increase to 17%, following a vote in Parliament today.
The government had proposed the TGST hike as part of its fiscal measures, and the bill was reviewed by the Parliament’s Joint Committee on Finance and Economic Affairs.
Out of the voting members, 70 supported the bill, while eight members voted against it today.
The TGST, which currently stands at 16%, will see the new rate of 17% take effect from June 2025. This amendment will initially hold the current rate until May 2025, allowing for a phased adjustment period before the new rate is implemented.
According to the Ministry of Finance, the increase in TGST to 17% is expected to generate approximately MVR 201.9 million in additional revenue by 2026. The revenue boost aims to support various government programs and strengthen the national budget amidst rising demands on state finances.
The government had proposed the TGST hike as part of its fiscal measures, and the bill was reviewed by the Parliament’s Joint Committee on Finance and Economic Affairs.
Out of the voting members, 70 supported the bill, while eight members voted against it today.
The TGST, which currently stands at 16%, will see the new rate of 17% take effect from June 2025. This amendment will initially hold the current rate until May 2025, allowing for a phased adjustment period before the new rate is implemented.
According to the Ministry of Finance, the increase in TGST to 17% is expected to generate approximately MVR 201.9 million in additional revenue by 2026. The revenue boost aims to support various government programs and strengthen the national budget amidst rising demands on state finances.
