The Tourism Ministry has requested the Finance Ministry enforce a cabinet decision to recover outstanding rent and fines from seven resorts, either through further negotiation or sale of the resort properties.
Tourism Minister Dr Mariyam Zulfa confirmed to Minivan News that a letter was sent to the Finance Ministry on Tuesday, requesting that it “take the measures decided by cabinet as the period [for repayment] has expired, that is to sell the resorts or recover the amounts owed through discussions.”
As 90-day notices had been given to resorts with unpaid rent on two occasions, said Zulfa, the delays were “a bit too much.” Last month the Tourism Ministry issued “a final warning” to ten resorts to settle at least 25 percent of the amounts owed before July 25 or have their licenses revoked. Three resorts have since complied with the notice.
The Tourism Minister revealed that she had argued against revoking licenses because it would “narrow the chance” of recovering the outstanding rents.
“Also when licenses are revoked, the resort has to be closed down immediately regardless of advance bookings, guests already at the resort and employees working there,” she explained, adding that as the resorts would be sold as a going concern, it would continue to operate.
In addition, different resort businesses faced “different challenges, such as financial constraints.”
“I know that from the day we gave notice [the resort companies] have been trying to raise the money overseas,” she continued. “But we cannot give further extensions as it would not be fair to others as well.”
Zulfa observed that the notices have been “very effective”, as a number of resort facilities had complied and paid outstanding rents and fines.
“As of July 25, the government is now owed US$12.47 million,” she revealed, adding that the figure was “considerably lower” than before.
Local media reported last month that the resort facilities owed over US$20 million to the state.
Zulfa dismissed speculation in the media at the time that the resorts had been afforded special treatment as some were owned by high-profile members of the ruling Maldivian Democratic Party (MDP), including MP Ahmed Hamza and Yacht Tours owner Abdulla Jabir.
The letter to the Finance Ministry however requested measures be taken against Alidhoo and Kudarah Resorts (Yacht Tours), Giraavaru Island Resort (owned by Abdul Rauf, M. Sunrose), Kihaadhupparu Island Resort (Athamaa Marine International) and Zitali, Filitheyo and Medhufushi (owned by the family of MP Hamza and Economic Advisor to the President Ali Shiyam).
“It is just a coincidence,” said Zulfa. “My mandate is to vouch on behalf of all stakeholders regardless of which party they belong to.”
Local daily Haveeru reported today that according to the Maldives Inland Revenue Authority (MIRA), a portion of the outstanding rents and fines had been paid by the companies. However MIRA would not be withdrawing its court cases against the resorts.
Commissioner General of Taxation Yazeed Mohamed told local media last month that MIRA “will not back down” or hesitate to take legal measures against businesses with outstanding rent and fines.
Zulfa said today that the Tourism Ministry would meet MIRA officials next week to discuss the possibility of reaching out of court settlements to recover the owed amounts.