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Maldives tax authority seeks US$20m from GMR

The Indian firm says it is not liable for any taxes due to an arbitration payout over the cancellation of its airport development deal.



The Maldives tax authority is seeking US$20 million in unpaid taxes and fines from evicted Indian developer GMR.

The Maldives Inland Revenue Authority issued notices in late 2017 for US$14.4 million owed as business profit tax and US$2.8 million as withholding tax, as well as fines amounting to US$3.3 million, Indian media reported Sunday citing a regulatory filing.

“We have refuted the tax claims as [the GMR-led consortium] has no business operations in Maldives,” a company official was quoted as saying.

“Further the compensation awarded to us by the arbitration tribunal indemnified us against any tax liabilities that may be imposed on us in Maldives.”

The official added that GMR has contacted the state-owned Maldives Airports Company Ltd “and will decide the future course of action basis their response.”

In 2016, MACL paid US$271 million in damages to GMR over the abrupt cancellation of a 25-year agreement to develop the country’s main international airport.

A Singaporean arbitration tribunal ruled that the previous government “wrongfully” terminated a “valid and binding” concession agreement in December 2012.

It is unclear whether MIRA has filed a lawsuit to recover the allegedly unpaid taxes.