Overall state revenue fare slow growth in 2020 amid pandemic

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Minister of Finance Ibrahim Ameer | Photo: People’s Majilis

The cumulative total of state revenues faced severe drops in 2020 as the viral pandemic resulting economic recess continues.

Maldives government revenues as of 30 April have been comparatively and considerably lower than the corresponding period of 2019.

The tax revenue cumulative total as of the review period was recorded at MVR4,574.9 million (MVR4.6 billion) whereas in the same period last year the cumulative total was at MVR6,130.0 million (MVR6.1 billion).

As for non tax revenue cumulative as of 30 April 2020, it was recorded at just MVR819.2 million while in the corresponding period of 2019, it had breached billion Rufiyaa mark to reach MVR1,786.4 million (MVR1.8 billion).

Tourism Goods and Services Tax (TSGT) under tax revenue components, have garnered MVR1,481.7 million (MVR1.5 billion) while in the same period last year it was observed at MVR2,133.5 million (MVR2.1 billion).

General Goods and Services Tax (GGST) revenue reached only MVR651.8 million as of 30 April, while in the corresponding period of 2019 it had reached MVR1,048.5 million (MVR1.0 billion).

Import duties collected to state reached MVR822.3 million while in the same period last year it was at MVR1,098.0 million (MVR1.1 billion).

The only tax revenue component that made a modest improvement in earnings was Business Profit Tax (BPT) observed at MVR922.7 million while in the same period in 2019 it was at MVR894.8 million.

Green Tax revenue has reached MVR246.4 million, which is slightly lower than the earning of MVR324.3 million in the same period last year.

The two most major non tax revenue streams to state are fees and charges and property income, both of which registered weaker earnings compared to the same period last year.

Earnings from state levied fees and charges were observed at MVR394.7 million as of 30 April, compared to the revenue of MVR579.5 million in the corresponding period the previous year.

Similarly earnings from property income reached MVR266.1 million while in the same period last year it was observed at MVR528.0 million.

As of the review period state has not earned any dividends from State-Owned Enterprises (SOEs).

This severe drop in revenues earned is strongly attributed from the now regressing economic growth.

Maldives suffered drastically in the wake of the Covid-19 viral pandemic, reaching its shores and affecting all major and minor economic components. The heavily tourism reliant country currently witnesses nil tourist activities as many countries across the globe have imposed border closures.

International travel market dwindled staggeringly, much to the dismay of Maldives tourism which relies on these foreign tourist markets as the main revenue generator to the industry.

Maldives announced temporary halt on the on-arrival visas, declared in March while the government was imposing travel restrictions on several major countries that are also key tourist markets to it.

 

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