The People’s Majlis has voted to accept a government-sponsored amendment to the Tax Administration Act that proposes stronger pre-payment requirements for taxpayers seeking to challenge disputed tax assessments before the Tax Appeal Tribunal, as part of efforts to strengthen tax compliance and improve the efficiency of revenue administration in the Maldives.
The bill passed its preliminary vote with 54 members voting in favour and 11 against among the 65 parliamentarians present. Following its acceptance, the legislation was referred to the Parliamentary Committee on Economic Affairs for detailed consideration. The bill had its first reading in Parliament on 20 October.
Under the proposed amendment, taxpayers disputing an assessment issued by the Maldives Inland Revenue Authority (MIRA) would generally be required to pay at least 50 percent of the contested tax liability before lodging an appeal with the Tax Appeal Tribunal. The legislation also provides for circumstances in which the amount required to be paid before an appeal may reach up to 100 percent of the disputed liability.
Presenting the bill, Fonadhoo MP Mohamed Mamdooh said the amendment seeks to establish a clearer statutory framework governing the payment of disputed tax amounts before formal appeal proceedings begin. The proposed framework is intended to strengthen the recovery of public revenue while ensuring that tax disputes continue to be addressed through the established tribunal system.
During the parliamentary debate, Feydhoo South MP Ibrahim Didi expressed support for stronger tax recovery mechanisms, highlighting the importance of ensuring that major businesses and high-income taxpayers meet their statutory obligations. He argued that unpaid and waived tax liabilities can significantly affect state revenue, particularly when companies with substantial commercial activity continue to make major investments while carrying outstanding obligations to the government.
The amendment also prompted debate among opposition lawmakers, who questioned the impact of increasing the pre-appeal payment requirement. Vaikaradhoo MP Hussain Ziyad noted that the threshold had previously been increased to 25 percent earlier this year and raised concerns over the decision to raise it further to 50 percent. He argued that the level of the pre-payment requirement would not necessarily determine the speed at which cases are resolved by the Tribunal.
The discussion comes amid the government’s broader efforts to strengthen public finances, improve revenue collection and maintain fiscal sustainability while reviewing existing taxation policies. Recent changes have also included the reversal of a previously proposed offshore Tourism Goods and Services Tax mechanism targeting foreign booking platforms, which had earlier been expected to generate approximately MVR 1.6 billion in annual revenue.
With the bill now proceeding to committee-stage review, lawmakers are expected to examine its provisions in greater detail, including the balance between strengthening tax collection, protecting state revenue and maintaining an effective appeals framework for taxpayers. The proposed amendment forms part of the government’s continuing focus on improving fiscal management and reinforcing the effectiveness of the Maldives’ tax administration system.
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