Tax increases are the most effective way to boost state reserves: Government
The government stated today that two different tax rises that take effect in January of the following year won't hurt the economy.
The amendment to the Goods and Services Tax (GST) Act will increase the TGST on tourism service facilities from 12 per cent to 16 per cent from January 1. GST will also go up from 6 per cent to 8 per cent from that date.
However, a large number of individuals in the tourism industry have criticized the government's action. In addition, MATATO claimed that the tourism industry will suffer a $50 million loss in the first quarter of the following year as a result of the tax increases.
Speaking at a press conference, President's office spokesperson Miuvaan Mohamed stated the decision to increase taxes was made after speaking with several international organisation. Spokesperson Miuvaan made the remarks responding to question from journalist regarding the concern from travel agents and tour operators from the tourism sector.
Miuvaan added that it won't affect the economy and further emphasize that there won't be any effects on the economy.
It will be made clear if you speak to representatives of the industry that this is a step toward managing not only the industry but also the entire country's economy. The economy won't be impacted by GST and T GST.
said Spokesperson Miuvaan
Miuvaan emphasized how crucial it is to take this action in order to guarantee the continuance of government services. He further went on to explain that the result could be seen next year.
Miuvaan pointed out that inflation is expected to be around 5.5 per cent as compared to the rate of inflation in nearby countries and other countries.
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