Maldives records growth in tourism revenue

Maldives has posted a significant growth in revenue from tourism in the first half of the year, owing to increased amounts of tourism related Goods and Services Tax (GST) and land rent collected.

Official figures published by the Maldives Inland Revenue Authority (MIRA) last week show that MVR 6.9 billion (USD 449 million) was collected as total tax revenue from January to May. It is a 5.9 percent increase over the MVR 6.4 billion (USD 417 million) collected in the same period of last year.

The increase in total state revenue is mainly attributed to a higher amount of taxes and fees collected from the tourism industry, especially GST and land rent.

MVR 2 billion (USD 137 million) was collected as tourism related GST in the first five months of the year — an increase over the MVR 1.9 billion (USD 129 million) received in the same period of last year. While MVR 414 million (USD 27 million) was collected as tourism land rent from January to May, it is a 24 percent increase over the MVR 333 million (USD 22 million) received in the first five months of the previous year.

Revenue from the recently introduced Green Tax, which is collected from all tourist properties, are also on the rise. MVR 320 million (USD 21 million) was received as Green Tax from January to May, which is an increase compared to the MVR 280 million (USD 18 million) collected in the same period of last year.

After years of double-digit growth in tourism, the Maldives has over the recent years observed a slowdown in growth. Tourist arrivals have crossed the one million milestone and is on course to reach 1.5 million by the end of this year, but the country has been struggling to create demand amidst a significant increase in bed capacity.

Over the past three years, dozens of uninhabited islands have been leased to local and foreign resort developers. Several international brands have entered into the market, increasing the number of resorts to 120. That number is set to increase as the government has announced the opening of some 20 new resorts by the end of this year.

However, the latest revenue figures are in line with a recent rebound in tourism which saw a double digit increase in arrivals.

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