The government has announced plans to raise three taxes, including the Tourism Goods and Services Tax (TGST), affecting tourism service facilities. Proposed tax changes have been submitted to the parliament. The agenda includes amendments to the Value Added Tax Act, the Maldives Tourism Act, and the Maldives Airport Tax and Fees Act.
Under the new measures, the green tax for tourism service providers and guesthouses with fewer than 50 rooms will increase from USD 3 to USD 6 per tourist. For resorts, the tax will rise from USD 6 to USD 12 per tourist, effective January 1 of next year. Notably, children under the age of 2 will be exempt from this tax.
Additionally, TGST will increase from 16% to 17%, projected to generate an additional USD 13.2 million for the state, with this change set to take effect on June 1 of next year.
The changes also proposes an increase in airport development tax and fees specifically for foreign travellers. The previous fee for economy class travellers will rise to USD 50 from USD 30, while business class fares will increase from USD 50 to USD 120.
First-class fares will go from USD 90 to USD 240, and fees for private jets will jump from USD 120 to USD 480.
These changes are part of the government’s fiscal reform agenda, with the Ministry of Finance estimating an overall revenue increase of USD 169 million.