Highlighting the findings of Household Income and Expenditure Survey 2009-2010 released by the Department of National Planning last week, in today's weekly radio address, President Mohamed Nasheed has said the government was determined to bridge the gap between rich and poor.
The President said reaffirmed the government's unwavering commitment to ensure equal distribution of income and achieve parity between rich and poor.
The President referred to the findings of the Household Income and Expenditure Survey to demonstrate the current gap between poor and rich in terms of expenditure per person per day.
He said the survey results show that “while 10 percent of the population spend Rf12 per day, the wealthiest 10 percent of the population spend around Rf230 per day.”
President Nasheed said taxation reforms proposed by the government was, in addition to increasing government revenue, aimed at reducing the disparity between rich and poor in the Maldives.
As part of the government's economic and fiscal reform programme, the government has submitted four taxation legislations to the People's Majlis, last week.
Speaking, in today's radio address about the taxation legislations proposed to the parliament, he said these were a part of the government's efforts to increase state revenue and build sustainable revenue streams for the government.
These four legislations are Goods and Service Tax Bill, Business Profit Tax Bill, Income Tax Bill and an Amendment Bill to Tax Administration Act.
Urging the members of parliament to expedite the passage of these bills through the parliament, he said these bills would enable the government to abolish import duties on many essential items, and reduce the government's reliance on import duties as the major source of revenue.
He said these legislations would reduce the indirect tax – import duties – paid indirectly by individuals, irrespective of rich and poor.
He underlined that the aim of the proposed tax reforms was to change “the [current] indirect tax on the value of goods to a tax payable by the wealthy, based on the profit of their businesses.”
Further, the President expressed his optimism that the new taxation regime would augment the government's current social protection programme, and “increase what the government will be able to give back to the people” as social security benefits.
Referring to other indicators of the survey, the President underlined the survey results that point to a notable increase in the people's living standards.
Household Income and Expenditure Survey results announced by Department of National Planning last week show that proportion of people living below poverty line, people who do not earn Rf23 a day, has decreased to 15 percent, which is a 50 percent reduction from 7 years ago.
Survey results indicate that average household income has increased by 32 percent compared to that of 7 years earlier. Simultaneously it also show that household expenditure has increased by 39 percent compared to 7 years ago.
