Business

Estimated revenue of income tax at MVR 670 million per year

Ministry of Finance has stated that through the introduction of Income Tax, a revenue of MVR 680 million per year can be generated.

While speaking on ‘Nuva Gadi Program’, Arshad Jameel, the ministry’s Tax Policy Consultant said around 6000 individuals meet the required criteria to pay the tax and that the purpose of income tax is to increase state revenue.

“With the introduction of Income Tax, which will include the income of individuals, it will pave way for a more holistic system. The main purpose behind this is to minimize the gap between the poor and the rich by utilizing the revenue of welfare”, he said.

According to the Income Tax bill submitted to the parliament, the government proposes to charge income tax on individuals who earn above MVR 40,000 and individuals who earn below the MVR 40,000 threshold will not have to pay income tax.

Arshad further noted that the International Monetary Fund (IMF)’s a recommendation to charge dual income tax but the government’s decision to charge at a progressive rate to make it less complicated.

He said income tax will be charged on civil servants above the State Minister level and will work in the same manner as the pension savings.

Full details are available at the link below:

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Source URL: Corporate Maldives

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