Majlis passes remittance tax

People’s Majlis, on Wednesday, passed the amendment to Employment Act which will allow the state to take a remittance tax of three percent.

It was passed with the vote of 41 lawmakers, while 25 lawmakers voted against it.

The bill was amended during Committee evaluation process to implement the remittance tax in October, instead of June.

The tax will be paid to Maldives Inland Revenue Authority (MIRA) through banks involved in transfer of money earned by expatriates who work in Maldives to their home countries.

The tax will apply to both expatriates with work visas, and those who are legally bound to have a work visa – even though they may not have one, or if their visas have expired.

The amount of money those registered for remittance tax need to pay each month needs to be calculated and written up in a statement – and the statement and the amount owing sent to MIRA by September 15.

Tax evasion or assistance in tax evasion will be punished with a fine equal to the amount of money sent abroad.

The bill states that the salary and service charged earned by an expatriate who has a work visa, or is not allowed to work without a work visa can only be paid to them by their employees after/through a bank account they must open in a registered bank in Maldives.

Employees need to open bank accounts for their expatriate employees in a registered bank in Maldives within three months the bill takes effect.

The Committee had passed to allow employees a six-month period, but Central Maafannu MP Asma Rasheed proposed to shorten the time period to three-months – which was approved by the Majlis when asked for a vote.

Gemanafushi MP Jameel Usmaan proposed an additional amendment so that every expatriate brought to the country needs to be given employment approval before they are brought to the country. And their employees need to send the deposit money to relevant State authorities – as prescribed by the law.