The Maldives government has almost doubled state income for the third quarter of 2011, increasing revenue 92 percent on the same quarter last year, according to the Maldives Inland Revenue Authority (MIRA).
Total dollar income for the period, according to MIRA, was US$60.5 million, made up largely of tourism lease payments (31.7 percent) and income from the 3.5 percent Tourism Goods and Services Tax (19.3 percent, or US$11.6 million). That tax is set to increase to six percent next year.
Total state income stands at Rf 3.4 billion for the year so far (US$220 million), according to MIRA.
Presenting the 2012 budget to parliament this week, Finance Minister Ahmed Inaz predicted that altogether, government income was expected to reach a record Rf 9 billion (US$583 million) this year.
Total expenditure out of the 2012 state budget is estimated to be Rf14.6 billion (US$946.8 million), an 18 percent increase from 2011. However the Inaz highlighted that recurrent expenditure was in line with income for the first time in many years, and the deficit was expected to drop to single figures.
Based on current estimates for 2011 the Maldives had recorded economic growth of 7.5 percent, Inaz said, an improvement of 5.6 percent in 2010. Growth was aided by a 21 percent tourism arrivals – the Maldives expects to welcome its millionth visitor for the year.
The introduction of the TGST was particularly significant in 2011 as it revealed that the government had been substantially underestimating the size of the tourism economy, which based on TGST receipts was actually three times larger than previously imagined.
Inaz expressed concern that 47 percent of transactions in the domestic economy were made through other currencies – almost all resorts charge in dollars and bank overseas – and called on the Maldives Monetary Authority (MMA) as the country’s central bank to take measures to enforce the use of rufiya as legal tender.