Amendment to stop levying taxes on low tourism areas

Hoarafushi MP Ahmed Saleem.

Hoarafushi MP, Ahmed Saleem has proposed an amendment to the Tourism Act Amendment Bill to exempt taxes from low-tourism areas for a period of 10 years at Wednesday's parliamentary sitting.

The first reading of the Tourism Amendment Bill moved by Kendhikulhudhoo MP Ahmed Easa on behalf of the government was on the agenda for Wednesday's sitting.

Proposing an amendment to the bill, Saleem pointed out that the guesthouse business had mostly expanded in the Male' region while the area was crowded with resorts. He stressed that the reasons behind this should be probed, adding tourism needs to be expanded to areas apart from the Male' region. 

In this trajectory, Saleem proposed to halt taxes for 10 years in the northernmost and southernmost regions of the country where tourism is least developed. He also proposed decreasing the rates of other tourism taxes by 50 percent for resorts in these areas during this 10-year period. 

Hoarafushi MP Ahmed Saleem. (Photo/People's Majlis)

“The cost of transportation is so high that tourists are reluctant to travel to these areas,” Saleem said.

Noting airports have been developed in many parts of the country to facilitate tourism, he raised the question as to whether tourism can actually be developed in light of the high fares. Therefore, he has proposed to halt taxes for areas where tourism is low

“Investors have no interest when the taxes applied to the Male' area are applied to areas where tourism is very less developed. Even if an island is acquired with the intention of developing a resort, the cost of development is extremely high, so there are many islands that have not been developed for 13, 14, 15, 16 years,” he said.

The government's proposed amendment calls for the abolition of GST on charter bed rentals for the introduction of a tourism real estate tax in place.