President Mohamed Muizzu announced last night that the government will introduce special concessions for small businesses, including tax relief measures and import duty exemptions.
The proposed tax reform will allow businesses to offset their tax liabilities against outstanding payments owed to them by the government. The President also noted that a comprehensive list of goods imported by small businesses eligible for duty exemptions will be publicised.
Furthermore, the President revealed that the mandatory registration threshold for Goods and Services Tax (GST) will be set for businesses with an annual turnover of MVR 1.5 million.
Speaking at the opening ceremony of Maldives Expo, Muizzu acknowledged that many small businesses face challenges due to the government's failure to settle outstanding invoices.
"Parties undertaking various projects for the government face immense difficulties because of delays in payments. We believe this is an inconsistency that must be rectified. Many stakeholders in the SME sector have brought this grievance to our attention," the President said.
Muizzu said that the decision to provide tax relief was aimed at resolving this issue.
"In this regard, we have consulted and decided to allow MSMEs to offset their taxes. This means that the amount the government owes to these businesses will be balanced against the taxes they owe the state, allowing them to settle the difference through an offset mechanism," he explained.
The President further noted that the duty exemptions for goods imported by small businesses are scheduled to take effect next year.
"To support businesses in the MSME sector, the government has decided to compile a full list of raw materials and items for which import duties will be reduced to zero percent. This policy will be implemented for five years starting from January 1, 2027," Muizzu said.
