In a statement issued by MIRA, it noted that under the Tax Administration Act, its primary responsibilities are implementing tax laws, administering tax policies, and managing and supervising the collection of all legally mandated state taxes.
The Maldives Inland Revenue Authority (MIRA) has stated that in auditing businesses, it is currently auditing tourism sector businesses and resorts as well, and that this work is being carried out fairly and without favor to any specific party.
In a statement issued by MIRA, it noted that under the Tax Administration Act, its primary responsibilities are implementing tax laws, administering tax policies, and managing and supervising the collection of all legally mandated state taxes.
It also highlighted that verifying whether taxpayers are calculating taxes in accordance with the law and ensuring they fulfill their legal obligations is a statutory duty of MIRA.
The statement noted that in fulfilling this responsibility, MIRA’s long-standing policy has been to enforce the law equally among all parties, regardless of the nature or size of the business.
Additionally, MIRA stated that its operations are planned under an established strategic plan and executed in accordance with a published Compliance Improvement Plan.
MIRA further stated that entities selected for auditing are chosen fairly through a compliance risk management framework based on a "risk-based" approach.
Accordingly, MIRA noted that it audits both tourism sector businesses and non-tourism sector businesses, emphasizing that the tourism sector accounts for a large percentage of state revenue.
Furthermore, MIRA mentioned that within the tax system, simplified arrangements have been established for small businesses regarding accounting, auditing, and filing tax returns.
While MIRA’s goal is to work collaboratively with businesses and increase tax compliance through support, it warned that regulatory action will be taken against those who intentionally fail to pay taxes.
MIRA issued this statement following remarks by Maldives Monetary Authority (MMA) Governor Ahmed Munawwar, who stated that MIRA needs to conduct a special audit to recover foreign currency generated by Maldivian resorts that ought to enter the banking system.
Speaking at the People's Majlis Budget Committee, Governor Munawwar stated that if every dollar entering the Maldives went into the local banking system, the current foreign exchange shortage would not be this severe.
He noted that while the Maldives receives approximately $5.9 billion in revenue, only $3.8 billion (65 percent) enters the Maldivian banking system.
Highlighting MIRA's figures, the Governor stated that out of the 185 resorts operating in the Maldives, only about 50 pay income tax or Business Profit Tax (BPT).
What does that mean? Are they not making a profit, or are there some underlying issues? Therefore, shouldn't their accounts be audited? MIRA shouldn't only visit corner shops. We also need to check whether the tourism figures are accurate.
The Governor further noted that monitoring needs to be strengthened to ensure every dollar coming into the Maldives enters the banking system.
In this regard, he stated that resorts and entities generating dollar revenue have now been instructed to open specific designated accounts, and that oversight will be tightened further during the coming year.
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