Overview of the Proposed Tax on Plastic Bags

The Waste Management Bill (“Bill”) submitted to the parliament by the Government of the Maldives on 16 May 2022 includes a provision on collection of a tax equivalent to MVR 2 (Two Rufiyaa) from plastic bags sold or provided at points of sale.

The above levy caters to one of the key legislative intents of the Bill, that is to cease the detrimental environmental impacts caused by waste. The levy further serves the “Single-Use Plastic Phase-out Plan 2020-2023 introduced by the Ministry of Environment, Climate Change and Technology as an initiative to phase-out the production, import and sales of particular single use plastics in the Maldives and to encourage the use of sustainable alternatives.

The proposed environmental tax on plastic bags inflicts certain administrative and compliance requirements on businesses. The Bill segregates the resulting obligations falling on such businesses based on the business’s registration status for Good and Services Tax (“GST”).

As such, this overview provides a summary of the provision of the Bill that proposes collection of tax on plastic bags.