Yameen opposes imposition of GST on communication services

Parliamentary Group Leader of Progressive Party of Maldives (PPM), a party included in the government coalition, Abdullah Yameen has said that he does not support imposition of GST on communication services even though this has been included in the estimated state budget for 2013.

While speaking at the parliament today, Yameen said that the government should identify means of income other than through imposition of GST on communication services. He said that he did not support the idea of including revenues ofMVR200 million through GST on communication services in the state budget for next year.

“We don’t believe that GST should be imposed on the communication sector. MDP government proposed to impose GST on telecom. We can’t accept that. The amendment was not passed by the parliament. So even now, it’s not acceptable to PPM, when people are out at sea, the only mode of transport they can rely on is the hand phone. I don’t think it can be justified to impose a tax on that phone call,” he said.

Yameen said that the government also needs to reconsider the increase of tourism GST from 8 to 15 percent. He said that even though the tourism industry is profitable, excessively high taxes can affect the industry, and advised to consult Maldives Association of Tourism Industry (MATI) on this matter.

Referring to the fact that the government cannot settle its recurrent expenses with the MVR12 billion which is estimates to collect as revenues in the coming year, Yameen said that the government is not sure if the “revenues can be collected or not”.

Yameen criticised the MVR16.9 billion budget submitted to the parliament by the eight-party-coalition government, and said that the government’s targets are unclear.

“By looking at this budget, we don’t know if the budget prioritises housing. By looking at this budget, it’s not easy for me to believe that funds will be used for construction of harbours or improvement of general health standards either,” he said.

Yameen said that no effort had been made to reduce recurrent costs, and highlighted that the state deficit currently stands at MVR3.1 billion.

“I believe that the real budget deficit for 12 months is MVR2 billion. I would like to express my concern over the mention in the budget of MVR4 billion as budget deficit. Because we’ve had budget deficit for five years now,” he said.

Yameen praised the inclusion of considerable funds in the budget for population centralisation projects and benefits to Police for ensuring safety in society.