MIRA Announces Increase in TGST Rate for Tourism Sector

The Maldives Inland Revenue Authority (MIRA) has issued a circular informing tourism facilities of an upcoming change to the Tourism Goods and Services Tax (TGST). Starting 1 July 2025, the TGST rate will increase from 16% to 17%, following the seventh amendment to the Goods and Services Tax Act.

MIRA has advised all GST-registered individuals and businesses in the tourism sector to update their systems in preparation for the change. The new tax rate must be applied to transactions occurring on or after 1 July 2025.

For businesses operating 24 hours a day, the circular specifies that the 16% TGST rate will apply to supplies made before midnight on 1 July, while supplies made after midnight will be taxed at the new 17% rate. Other tourism sector businesses are required to apply the 17% rate from the start of their business day on 1 July 2025.

MIRA has also recommended that tourism businesses ensure their pricing reflects the updated tax rate and that they communicate these changes to their customers. This change is part of the government's ongoing efforts to regulate the tourism sector’s taxation framework and ensure smooth transitions for businesses.