State rejects reduction of resort rent

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Overwater villas at Sirru Fen Fushi | Photo: Luxatic

Minister of Finance, Mr. Ibrahim Ameer announced on Wednesday notifying the rejection of reducing the rate of tourism land rent by the Economic Council.

The reduction in the rates of tourism land rent was proposed in the amendment bill to the Maldives Tourism Act.

Speaking at the press conference to address the matter, Mr. Ameer noted that the amendment to reduce the rent was made prior to the conflict between Russia and Ukraine.

However, in light of the current geo-political landscape, which is affecting the global economic progress, the amendments will be withdrawn.

Meanwhile, Maldives Inland Revenue Authority (MIRA) claimed that should the rent from tourism islands be reduced then the state faces an estimated loss of MVR590 million in annual revenue.

Despite the decision to rescind the amendment surrounding reduction of rates on tourism land rent, other proposed amendments will not be withdrawn.

On the other hand, it was recently announced that the government has not received a collective total of MVR656 million from a total of 12 resorts in outstanding resort rent.

According to statistics from Ministry of Finance, the Maldives state receives an average of MVR1.6 billion from tourism land rent on an annual basis.

Reduction in the rates of the tourism land rent will result in a drop of 40% in the state’s collective earnings per annum.

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