The People’s Majlis today passed amendments to the Foreign Exchange Act requiring resorts to convert 40 percent of their US dollar earnings into Maldivian Rufiyaa starting in October, despite strong concerns from the tourism industry that such a requirement is unfeasible.
The initial proposal to amend the law did not include such a high conversion rate. The amendments were introduced during today’s parliamentary session by Funadhoo MP Mohamed Mamdhooh. The changes were incorporated into the bill, with 47 members voting in favour and 12 members voting against the proposal.
The Maldives Association of Tourism Industry (MATI), which represents 146 of the 200 resorts operating in the country, has previously stated that converting 40 percent of resort revenue is not a viable requirement for businesses.
In addition to the increased rate, Parliament also voted to shorten the timeframe for currency conversion. Resorts will now be required to exchange the funds within 28 days, a reduction from the current three-month window.
Under existing regulations, tourism establishments are required to convert either $500 per tourist or 20 percent of their total revenue. The new measures passed today are set to take effect in October.
