The Maldives has recorded a significant improvement in its fiscal position during the first nine and a half months of 2026, with the government reducing the budget deficit to MVR 4.50 billion, nearly half the MVR 8.84 billion deficit recorded during the corresponding period last year.
According to fiscal data covering the period from 1 January to 15 October 2026, the government collected MVR 31.89 billion in revenue and grants, while total recurrent and capital expenditure stood at MVR 36.39 billion. The figures indicate an improvement of approximately MVR 4.34 billion in the overall budget balance compared with the same period in 2025, reflecting the government’s continued focus on fiscal management while maintaining essential public services and development priorities.
Revenue and grants increased by MVR 813.1 million, or 2.6 percent, compared with the same period last year. Tax revenue remained the backbone of government income, reaching MVR 24.63 billion and accounting for 77.2 percent of total revenue. This represents a seven percent increase from MVR 23.03 billion collected by mid-October 2025.
The tourism industry continued to play a central role in supporting government revenue and the wider Maldivian economy. Goods and Services Tax generated MVR 12.36 billion, with Tourism GST alone contributing MVR 8.12 billion, significantly exceeding the MVR 4.43 billion generated through General GST. The figures highlight the continued importance of resorts, hotels and the broader tourism sector in sustaining public revenue, foreign exchange earnings and economic activity across the country.
Resort properties also remained an important source of non-tax revenue. Government property income reached MVR 1.75 billion during the period, of which approximately MVR 1.49 billion came from resort lease payments. These contributions demonstrate the substantial fiscal value created by the Maldives’ resort industry beyond tourism-related taxation, with resort leases providing the state with a dependable source of income that supports public expenditure and national development.
Other major revenue streams included MVR 5.90 billion from business and property taxes, while import duties increased from MVR 2.42 billion last year to MVR 2.79 billion this year. Airport service charges and departure taxes generated MVR 1.55 billion, Green Tax revenue reached MVR 1.62 billion, and royalties contributed MVR 259.2 million.
Although overall non-tax revenue declined from MVR 8.70 billion in 2025 to MVR 6.74 billion this year, several important revenue categories continued to make strong contributions. Fees and charges generated MVR 2.83 billion, Airport Development Fees contributed MVR 2.30 billion, dividends from State-Owned Enterprises reached MVR 552.3 million, and foreign grants increased substantially from MVR 310.7 million to MVR 522.4 million.
Government expenditure during the period remained focused primarily on maintaining public services, social protection programmes and essential government operations. Recurrent expenditure reached MVR 31.35 billion, representing 86.2 percent of total expenditure. Salaries, wages and pensions accounted for MVR 12.05 billion, while administrative and operational expenditure reached MVR 19.23 billion.
Grants, contributions and subsidies totalled MVR 10.45 billion, including MVR 2.48 billion in direct subsidies, MVR 2.02 billion for Aasandha health insurance payments and MVR 1.80 billion in grants to local councils. Financing and interest expenses amounted to MVR 3.84 billion.
At the same time, the government maintained a more restrained approach towards capital expenditure. Spending under the Public Sector Investment Programme declined by 40.2 percent, from MVR 8.31 billion during the same period last year to MVR 4.97 billion in 2026. Transport infrastructure remained the largest development expenditure category at MVR 1.98 billion, followed by public housing and utilities at MVR 673.2 million, land management at MVR 651.6 million, educational infrastructure at MVR 459.8 million and healthcare infrastructure at MVR 313.4 million.
The government recorded a primary deficit of MVR 650.8 million before financing and interest costs. Financing and interest expenditure of MVR 3.84 billion brought the overall fiscal deficit to MVR 4.50 billion.
Debt servicing also remained an important component of the government’s financial obligations. Principal repayments on government loans reached MVR 10.10 billion during the period, more than double the MVR 4.57 billion repaid by the same point last year. Although principal repayments are not included as expenditure when calculating the fiscal deficit, the increased repayments demonstrate the scale of the government’s ongoing debt management commitments.
Outstanding government securities stood at MVR 100.43 billion as of 5 October, comprising Treasury bills, Treasury bonds, Islamic financing instruments and other securities used to meet financing requirements. Domestic instruments accounted for MVR 98.89 billion, while external Sukuk bonds accounted for MVR 1.54 billion.
The approved 2026 national budget projects MVR 40.37 billion in revenue and grants and MVR 49.21 billion in expenditure, with a projected full-year deficit of MVR 8.84 billion. By 15 October, the government had already collected 79 percent of its annual revenue target while utilizing 73.9 percent of planned expenditure.
The latest figures present an encouraging improvement in the Maldives’ fiscal position, supported by stronger tax collections, continued tourism-sector performance and tighter management of development expenditure. With resorts continuing to provide substantial contributions through Tourism GST, Green Tax, lease payments and wider economic activity, the tourism industry remains a critical pillar supporting government revenue and the country’s broader economic stability.
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