The Maldivian government is set to propose an amendment on Monday to increase the Tourism Goods and Services Tax (TGST) on tourists to 17% and double the green tax.

The amendments to the Tax Act will be presented in parliament on Monday.

The proposed changes include raising the TGST from 16% to 17%, effective June 2025.

Additionally, the green tax will be increased as follows:

• For guesthouses with fewer than 50 rooms: from $3 to $6 per night, per person.
• For resorts, city hotels, and tourist establishments with more than 50 rooms: from $6 to $12 per night, per person.

This increase in the green tax is planned to take effect from January 2025.

The government also intends to exempt children under the age of two, who are currently subject to the tax, from the green tax.

The purpose of these proposed tax increases is to enhance foreign exchange earnings and strengthen the Maldives’ foreign currency reserves.

The TGST was last raised from 8% to 16% in January 2023.