The People’s Majlis today passed a government-sponsored bill to amend the Import-Export Act, a move set to slash current cigarette prices by 50 percent.
The bill was passed unanimously with 68 votes in favor. The price hike, which had been implemented by the PNC-led supermajority in November 2024, saw the government introduce a specific duty of MVR 8 per cigarette and increase the ad valorem duty on such shipments to 50 percent.
Currently, a packet of cigarettes in local shops retails between MVR 240 and MVR 250. A carton of cigarettes, which previously sold for MVR 995, had surged to over MVR 2,200 following the sharpest duty hike in Maldivian history.
However, with the passage of today’s bill just 18 months later, the price of a cigarette pack is expected to drop to MVR 130.
The government’s amendment proposed reducing the ad valorem duty from 50 percent to 30 percent, while cutting the specific duty from MVR 8 to MVR 4 per cigarette.
This adjustment represents a 50 percent reduction in the specific duty and a 40 percent reduction in the ad valorem duty. The total tax burden on cigarettes will be nearly halved.
The government first announced its intention to lower tobacco duties ahead of the by-elections held on June 6. While the announcement was made by Home Minister Ali Ihusaan, the government maintains that the decision to lower prices follows recommendations from the World Health Organization (WHO).
