ABTA has asked the Maldives President to postpone enforcement of an extended 17% tourism tax for at least six months, to allow for a full consultation with the international travel industry.
Under an amendment to the Maldives Goods and Services Tax Act, overseas businesses selling Maldives holidays will have to register for and pay the country’s 17% Tourism Goods and Services Tax from 1 October.
In addition to delaying the enforcement, ABTA is seeking confirmation from President Mohamed Muizzu that overseas travel agents acting as a disclosed agent for an overseas tour operator will not have to register and will be exempt from the tax.
The trade association has repeated its request for a meeting with representatives from ABTA, the European Travel Agents’ and Tour Operators’ Association and the World Travel Agents Associations Alliance to discuss ‘fundamental issues’ with the legislation, which it believes make the tax ‘unworkable in certain scenarios’.
ABTA Director of Industry Relations Susan Deer said: “We understand that legislation to amend the Maldives Goods and Services Tax Act had been under consideration for some time, but it was introduced without any consultation with international travel businesses.
“This failure to consult has resulted in legislation and guidance which is not fit for purpose.
“We have written to the Maldives Tourism Minister on two separate occasions, which is why we are now escalating our concerns direct to the President of the Maldives.”
ECTAA Secretary General Erik Drésin added: “European travel agents and tour operators have been long-standing partners in building the Maldives into a world-leading destination.
“However, extending domestic tax obligations extraterritorially with virtually no consultation or lead time severely disrupts established commercial operations.
“A suspension of enforcement and immediate, constructive dialogue are essential to ensure the rules are workable, legally robust, and fair to all partners involved.”
ABTA first wrote to Tourism Minister Mohamed Ameen on 27 August, before the law was ratified.
