“Income tax needed to slash income gap” – MMA governor

Maldives Monetary Authority's governor Dr Azeema Adam. FILE PHOTO: NISHAN ALI/MIHAARU

Maldives Monetary Authority’s governor Dr Azeema Adam. FILE PHOTO: NISHAN ALI/MIHAARU

Income tax is necessary to minimise the income gap in society, declared Maldives central bank’s governor Azeema Adam late Sunday.

Speaking at the parliamentary budget review committee meeting held to discuss the State Budget 2017 proposed to the parliament, Maldives Monetary Authority (MMA)’s governor noted the lack of mention of income tax in the budget. However, she repeatedly stressed her personal opinion of an income tax’s necessity.

“The inequality of the Maldives’ income can be minimised in the future by imposing an income tax under an appropriate system,” said Azeema in response to a question posed by Gemanafushi MP Jameel Usman.

However, she concurred it is too late to implement an income tax in the coming year as sufficient time is necessary to compile the tax policy and raise public awareness to familiarise civilians with a new tax.

“Imposing taxes must be done as transparently as possible.”

While Governor Azeema is advocating to impose an income tax on civilians of high income, complaints of the lack of tax imposed on the rich have become common, especially with the proposed Airport Development Charge (ADC) of USD 25 included in the state budget to be charged from all departing passengers from Ibrahim Nasir International Airport (INIA).

Whereas an income tax is not in the government’s works yet, the state budget of MVR 26.8 billion proposed for next year includes higher taxes and new income generating fees to increase state revenue including ADC, long leases of reclaimed land for guesthouse development, a congestion fee from vehicles in capital Male, higher import duties of cigarettes, fizzy drinks and energy drinks, authorising an additionional 400 licenses for taxis, increasing the dividend of state run companies to 60 percent and charging acquisition fees from Special Economic Zones (SEZ).

Meanwhile, the parliamentary debate over the State Budget 2017 commenced early Monday.

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