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Parliament approves increase in Tourism Taxes

The parliament has formally approved the government's proposals to increase tourism taxes. The amendments to the Goods and Services Tax Act, the Maldives Tourism Act, and the Taxes and Fees on Passengers Departing from an Airport Act were approved by the parliament without any additional modifications.

With 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, with children under the age of 2 exempt from this tax.

Additionally, the TGST will increase from 16% to 17%, projected to generate an extra USD 13.2 million for the state, effective June 1 of next year.

The amendments will also raise airport development taxes and fees for foreign travellers. The fee for economy class travellers will rise from USD 30 to USD 50, while business class fares will increase from USD 50 to USD 120. First-class fares will jump from USD 90 to USD 240, and fees for private jets will rise 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.