GST-Registered Businesses Begin To Levy Tax On Plastic Bags

In line with the amendment brought to the Waste Management Act last year, all Goods & Services Tax (GST) registered businesses have started to levy taxes on plastic bags effective from Tuesday, 18^th April 2023. The amendment brought to the act mandated that all businesses registered for GST must also tax customers on plastic bags. This aligns with the Government’s efforts to phase out single-use plastic in the Maldives by 2023.

Starting yesterday, all GST-registered businesses will charge a fee at the rate of MVR 2 per plastic bag supplied by the seller. However, three categories of plastic bags are exempted from tax charges. This includes plastic bags used to carry any type of fresh, unpackaged fish, bin liners and plastic bags sold from duty-free shops. Earlier in the year, Maldives Inland Revenue Authority (MIRA) published guidelines on how to levy taxes on plastic bags.

According to the guidelines disclosed by MIRA, starting from 18^th April all GST-registered businesses are also required to include information on the plastic bag fee collected in their GST returns with all tax payments made to the authority in Maldivian Rufiyaa before the deadline. Those who fail to meet the deadline will be penalized by a penalty fee added to their outstanding amount for each day that passes following the date.

The Maldives is taking great strides to reduce plastic pollution in the country. With taxes being levied on plastic bags, customers and shoppers are encouraged to carry their own shopping bags when making purchases. As of now, the manufacture, import and marketing of single-use plastics are prohibited in the Maldives under the amendment brought to the Environmental Protection and Conservation Act.