Italian Tour Operator Suspends New Maldives Bookings Over Tax Changes
2 އޮކްޓޯބަރު 2026 | ހުކުރު 14:22Italian tour operator "Kia Ora Viaggi" has suspended Maldives bookings in protest against the government's decision to levy TGST on the profits of foreign tour operators, labeling the move a violation of international law. The company stated that taxing businesses operating outside Maldivian borders is unacceptable, and the suspension serves as a formal protest against the new taxation policy.
Tourists queueing at the seaplane check-in area. | MACL
Following the decision to levy taxes on services provided in the Maldives to foreign tour operators, the popular Italian tour operator "Kia Ora Viaggi" has suspended all new bookings and sales for travel to the Maldives.
This was disclosed in a press release published on the company's official website.
In this regard, Kia Ora Viaggi has announced its decision to suspend all sales and stop accepting new bookings for travel to the Maldives, effective October 1. The company stated that this decision was made after careful consideration as a protest against the new taxation policies introduced by the Maldivian government.
The company has characterized the expansion of the Maldives' Tourism Goods and Services Tax (TGST) to foreign tour operators as a tax lacking any legal foundation.
The Maldivian government has announced that effective October 1, 2026, the Tourism Goods and Services Tax (TGST) will be applied to the profit margins of foreign travel agencies and tour operators selling Maldivian resorts and hotels. According to the statement, this tax, currently set at 17 percent, will be implemented in a manner similar to the Italian VAT model.
Furthermore, the company stated that requiring foreign agencies to register with the Maldives Inland Revenue Authority (MIRA) for tax payment and accounting purposes is unacceptable. The company argued that mandating foreign entities to pay taxes and maintain financial records is inconsistent with international law. It further asserted that a national government lacks the legal jurisdiction to enforce tax regulations on companies operating legally outside its borders.
Furthermore, the company's consultancy, itinerary design, sales, and customer support operations are all based in Italy. Under current Italian regulations, activities involving the planning of travel to destinations outside the European Union are not subject to foreign taxation if conducted within Italy.
Furthermore, the company stated that it continues to regularly pay GST and Green Tax on its resorts, transportation, and all other services provided within the Maldives. The company characterized the taxation on value-added activities performed in Italy as an unjustified attempt to levy taxes on consultancy work that has no legal or operational connection to the Maldives.
The company noted that increasing the national GST would have been a more viable alternative and stated that it has suspended bookings and travel sales to the Maldives as a gesture of protest. Furthermore, the company emphasized that sustainable and high-quality tourism must be built upon mutual respect, fairness, and the protection of the rights of businesses that work daily to ensure a safe holiday experience for travelers.
The Indian Association of Tour Operators (IATO), India’s largest body of tour operators, and the Russian Union of Travel Industry (RST) have expressed concern over the proposed changes to the Goods and Services Tax (GST) within the Maldivian tourism sector.
