A bill proposing amendments to the Income Tax Act to increase State revenue by MVR 496.3 million has been referred back to Parliament’s Economic Affairs Committee for further review.

The Whole House Committee approved the referral today, with all 47 MPs who voted supporting the decision.

The bill was submitted by Government-aligned Vilufushi MP Hassan Waheed on 21 October and was initially accepted for consideration on the same day.

The proposed amendments seek to revise the rules governing interest deductions when calculating taxable income. Under the bill, interest capacity would be capped at 25 per cent of a taxpayer’s tax EBITDA for the relevant tax period. The bill also proposes removing certain existing provisions of the Income Tax Act.

The referral was proposed by Inguraidhoo MP Ibrahim Falah and seconded by Baarah MP Ibrahim Shujaau.

The amendments are expected to generate an additional MVR 496,300,302 in State revenue and are proposed to take effect from 1 January 2027, if passed and implemented.