Main-ruling party, Maldivian Democratic Party (MDP) has proposed to introduce income tax for those who earn above MVR 60,000 per month.
An income tax is a tax that governments impose on income generated by businesses and individuals within their jurisdiction. By law, taxpayers must file an income tax return annually to determine their tax obligations. Income taxes are a source of revenue for governments. They are used to fund public services, pay government obligations, and provide goods for citizens.
Introducing an income tax is part of President Ibrahim Mohamed Solih's presidential pledge.
MDP will be submitting a bill at the next parliament to implement the pledge.
According to the draft of the proposition prepared by MDP to be submitted at the 19th parliament, a "Public Income Tax" will be introduced, where individuals earning an income between MVR 60,000 and 100,000 will be subject to 3.5% income tax. Those earning between MVR 100,000 and 150,000 will be subjected to income tax at the rate of 6.5% while those earning between MVR 150,000 to 200,000 will need to pay income tax at a 10% rate. Individuals earning above MVR 200,000 per month will need to pay income tax at 15%.
All residents living in Maldives will need to pay income tax, irrespective of whether the source of income is local or international.
MDP has also proposed amendments to the Employment Act, seeking a minimum wage of MVR 200 per day for all sectors.
