Maldives proposes 17pc tax on foreign travel agents and tour operators

Maldives Parliament passed 17pc tax on foreign travel agents and tour operators
Tax applies to gross profit margin, not total holiday cost, effective 1st October 2026
Estimated MVR 1.61 billion annual revenue to address currency shortages
Global travel bodies express concern over mid-season contract disruption
Foreign entities must register with MIRA and pay tax in foreign currency

The Maldives Parliament has passed a historic tax amendment extending the country’s 17pc Tourism Goods and Services Tax to offshore booking platforms, foreign tour operators and overseas travel agents under a new destination principle that targets services based on consumption location rather than business legal base.

The reform, effective 1st October 2026, applies specifically to unregistered foreign entities including Online Travel Agencies such as Booking.com and Expedia, with the tax levied on the gross profit, margin or commission retained by the foreign operator rather than the total holiday cost.

The Maldives Inland Revenue Authority estimates the measure will generate an additional MVR 1.61 billion annually to address domestic foreign currency shortages, though global travel bodies have expressed concern about mid-season implementation affecting winter 2026/2027 contracts and brochures already priced and signed months ago.

Maldives Inland Revenue Authority spokesman shared: “The tax specifically applies to unregistered foreign entities selling Maldives holidays with no local physical establishment”