President approves US$ 25 airport service charge hike

President Abdulla Yameen Abdul Gayoom has ratified a law raising airport service charge from departing foreign passengers to US$ 25.

The law will come into force in July and is part of the current administration’s revenue raising measures.

The government anticipates over MVR 100 million (US$ 6.4 million) in additional revenue from the increased departure tax.

The People’s Majlis has also approved other revenue raising measures proposed by the government, including hiking import duties, reintroducing the bed tax until the end of November, raising the Tourism Goods and Services Tax (T-GST), and introducing GST for telecommunications services from May 1.

A proposal by the administration of former President Mohamed Waheed to raise the service charge to US$30 was narrowly defeated in April 2013.

The 1978 law imposing the airport service charge on departing passengers was first amended under the Maldivian Democratic Party government and raised to US$18.5 for foreigners.

The imposition of a similar Airport Development Charge (ADC) of US$25 by Indian infrastructure group GMR was previously a major point of contention for the Waheed administration, which terminated the concession agreement with the GMR-led consortium to modernise the airport in December 2012.

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