Maldives has reported a notable improvement in its fiscal position, with total revenue and grants rising by 9.9 percent compared to the previous year, reflecting stronger economic activity and firm demand in the tourism sector. According to the Ministry of Finance and Planning’s Weekly Fiscal Development Report, state revenue has reached USD 2.2 billion, up from USD 1.96 billion a year earlier, underscoring the country’s resilience and ongoing appeal as a global island destination.
Tax revenue continues to be the backbone of the government’s income, increasing by 7.7 percent to USD 1.61 billion. Within this, Goods and Services Tax (GST) revenue recorded an especially strong performance, growing by 11.5 percent to USD 875.5 million. Tourism GST (T-GST) has been a key driver of this momentum, rising by 13.7 percent to USD 583.7 million since 1 July this year. This growth reflects sustained visitor arrivals and robust spending across resorts and other tourism properties, as guests increasingly seek premium experiences in Maldivian islands. For resort operators and tourism investors, these figures signal healthy occupancy, strong average daily rates, and a favourable environment for further enhancement of high-end products and services.
Additional tourism-related taxes also posted substantial gains, further underlining the sector’s central role in the Maldivian economy. Green tax revenue surged by 108.0 percent to USD 123.2 million, illustrating both higher tourist volumes and the expanding contribution of visitors toward environmental sustainability initiatives. Airport service charges and departure tax climbed by 60.2 percent to USD 97.3 million, reflecting increased international passenger throughput and the growing importance of air connectivity for the country’s resort and hotel network. These developments collectively indicate that the tourism ecosystem—from luxury island resorts to transport providers, is operating at a robust pace.
Non-tax revenue contributed significantly to the fiscal improvement as well, rising by 22.1 percent to USD 531.8 million. Fees for various services recorded a sharp 60.3 percent increase, reaching USD 239.9 million. A major component of this was airport development fees, which accounted for USD 103.8 million, marking a 60.4 percent increase. This signals continued investment in gateway infrastructure that directly supports resort operations, by improving guest transit, enhancing flight connectivity, and elevating the overall arrival and departure experience for high-value travellers who frequent Maldivian resorts.
On the expenditure side, the government has combined this revenue growth with disciplined spending. Total state expenditure fell by 13.5 percent to USD 2.2 billion, down from USD 2.6 billion in the previous year, while government operating expenditure declined by 10.7 percent to USD 129.7 million. Government aid spending on grants and subsidies recorded a marginal 4.0 percent decrease and, despite subsidies exceeding the budget, overall spending in this area remained 11.1 percent lower than the previous year. This was largely driven by the decline in global oil prices, which eased the fiscal burden of energy-related subsidies.
Capital expenditure saw the most pronounced adjustment, decreasing by 53.9 percent to USD 317.8 million from USD 680.9 million in the previous year. This reduction is attributed to tighter control over project spending and the use of contractor financing for selected projects. Public Sector Investment Programme (PSIP) expenditure fell by 25.6 percent to USD 447.5 million from USD 603.1 million. Within PSIP, transport infrastructure received the largest allocation at USD 278.9 million, with key investments directed toward airport development (USD 207.5 million), bridge construction (USD 54.9 million), and harbour construction (USD 20.1 million). For the resort sector, continued emphasis on airports, bridges, and harbours is especially significant, as these projects enhance connectivity between the capital, regional hubs, and resort islands—supporting seamless guest transfers, more efficient logistics, and greater accessibility to emerging tourism zones.
Despite recording a deficit in the last week of October, the first such instance this year, the overall budget deficit for the period stands at just USD 52.4 million, representing a sharp 91.1 percent reduction from the USD 590 million deficit recorded in the same period last year. The Ministry underlined that this outcome reflects a combination of economic growth, effective revenue-enhancement policies, and rigorous expenditure control. While the overall balance remains in deficit, the primary balance is in surplus by USD 207.5 million, providing a more comfortable backdrop for fiscal management and investor confidence.
From November, the government has implemented its pay harmonisation policy to establish a fairer and more consistent pay structure within the public service. This reform is being rolled out alongside continued cost control and a carefully structured approach to capital projects. The Ministry has stressed that as revenues continue to strengthen, capital expenditure will be increasingly directed toward sectors and resources deemed critical for sustained economic growth. For resorts and tourism investors, this combination of stronger fiscal fundamentals, targeted infrastructure development, and a thriving visitor economy points to a supportive environment for long-term planning, reinvestment, and the introduction of new tourism products across the Maldives’ globally renowned island destinations.
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