Legislation proposed by the government to raise the airport service charge from departing international passengers to MVR460 (US$30) was narrowly rejected by parliament today.
The amendment bill submitted by government-aligned MP Riyaz Rasheed was rejected with 28 votes against, 27 in favour and two abstentions.
At the parliamentary debate on the bill yesterday (April 15), MPs of the opposition Maldivian Democratic Party (MDP) and government-aligned Progressive Party of Maldives (PPM) opposed the proposed hike.
MPs of both the majority and minority parties alleged that President Dr Mohamed Waheed planned to use an expected MVR185 million (US$12 million) from raising the departure tax to finance his presidential campaign.
The 1978 law imposing the airport service charge on departing passengers was first amended under the previous administration 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.
Hiking the airport service charge from US$18 to US$30 was among a raft of measures proposed by the Finance Ministry within the estimated 2013 budget to raise MVR 1.8 billion (US$116 million) in new income.
Finance Minister Abdulla Jihad told MPs in December 2012 that additional revenue was needed to finance the fiscal deficit and rein in soaring public debt, which was projected to reach MVR 31 billion (US$2 billion) or 82 percent of GDP by the end of 2013.
On January 29 this year, the cabinet decided to impose austerity measures to manage the budget following revenue shortfalls.
“Members of the cabinet noted that, by late this year, the country might have to face enormous challenges unless strict budgetary control measures were not implemented,” the President’s Office said at the time.
During the budget debate in December 2012, Majority Leader MP Ibrahim Mohamed Solih warned that the additional revenue projected in the budget was unlikely to materialise.
The MDP parliamentary group leader noted that most of the proposed measures – such as hiking the Tourism Goods and Services Tax (T-GST) to 15 percent, introducing GST for telecom services, and “selectively” reversing import duty reductions – required parliamentary approval.
Acting Finance Minister Ahmed Mohamed was unavailable for comment today on the impact to government finances from the loss of projected revenue.
Meanwhile, legislation on fiscal responsibility submitted in 2011 by the previous government was passed with 42 votes in favour and 10 against at a sitting of parliament on Monday (April 15).
If the bill is ratified, the government would be prohibited by law from obtaining loans after January 1, 2016 to finance recurrent expenditure or loan repayment.
The bill also sets limits on government spending and public debt based on proportion of GDP, mandating the government to not allow public debt to exceed 60 percent of GDP.
Borrowing from the central bank or Maldives Monetary Authority (MMA) should not exceed seven percent of the projected revenue for the year, while such loans would have to be paid back in a six-month period.
Moreover, a statement outlining the government’s mid-term fiscal policy must be submitted annually to parliament at the end of the financial year in July.
12 thoughts on “Hiking airport service charge to US$30 narrowly rejected at parliament”
Dr. Waheed's government has made the Maldives one of the poorest developing country worse than Somalia, Sudan, Mali and Ethopia.
Had GMR been in Maldives today, we would still enjoy the international support and aid which now is unheard as most countries or investors are skeptical.
Waheed with his religious backing of senseless, uneducated extremists has also failed the country in getting aid from the Muslim world which, during Gayooms tenure, assisted us anytime we had crisis.
Waheed in support of the backward world fashioned, corrupt judges has messedup the judiciary system that everyone is above the law.
With the support of the main coup leaders (Riyaz, Nazim), drug dealers, terrorists, assassins and all types of criminals have found Maldives a safe heaven. A few bucks to the government and all is free.
It is the most absurd and idiotic idea for the government to try hike the airport service charge which was the cause of kicking out GMR. What a joke!
Desperation is the word as the government, the coup leaders try the best to stay in power....let it be known to them that on September 8th, dhonis would be waiting at Jetty No.1 to take you morons not to Dhunidhoo, but a worse off island where you will never see light nor hear a sound.
Either ask for forgiveness and return the monies you have squandered or take a one way flight to Malaysia where Gayoom will be happen to entertain you.
@GMR after reading i must say that, you dont have an ounce of intelligence in you. First of all, today it was announced that MACL got a profit of more than 300m within the first 3 months of this year. If GMR was here, MACL would already be bankrupt. So the decision to kick out GMR was an awesome decision by President Waheed.
Secondly,GMR wasn't charging airport service charge. They were charging money in the name is airport development charge. Totally two different things. Airport Service Charge goes straight to State Treasury. Airport Development Charge is an income for GMR, and the real issue here is, they started charging it without even starting the development work. And Nasheed's govt had allowed them to charge this money for 25YEARS. This is something with is unheard of. No country has ever allowed ADC to be charged for such a long period of time. Maximum is 5 years. So get your facts right before you comment.
Thirdly, even if a new president is elected on 7th September, he wouldnt be in power until 11th November. So your statement about 8th September doesnt make any sense.
7th February and 7th December will go down as historic days. majority of the population supports this. So no, no one in this government is going to ask for forgiveness. Some people in the previous government will go to jail before the end of this year. For all the corrupt deals which they made.
@GMR and @Dhonbe
Both of you seems to be cult worshipers of Nasheed or Gayoom or Qasim or Waheed or Imran or thasmeen. We don't need these cult worshipers. We need those who can speak against the corruption of Gayoom Govt(FBID case, Jangiya Nazim case, Sale of Air Maldives to foreign partner and it's bankruptcy), Anni (Reeko Moosa case, Mariya and her family cases), Thasmeen and his BML loan case, Waheed (Ilyas Hussain and border controller case and Waheed's involvement of coup) etc. Don't try to fool all the maldivians all the time. We are not fools. People like Dr. Hassan are just crazy for power and addicted to power. Nasheed (Anni) is trying his best to introduce gay rights and atheism in Maldives with Zionist money. These are all publicly known facts.
Lunacy at its best!
I don't find a difference between GMR and Arthur Brothers, hehe
dhonbe on Tue, 16th Apr 2013 8:34 PM
"First of all, today it was announced that MACL got a profit of more than 300m within the first 3 months of this year. "
Yes, we all read that. Until that is audited by a credible audit authority I wouldn't believe a word of it. Remember these guys also ran the airport for the last 40 odd years. What do we have to show for that? Just a tin hut and a bit of tarmac.
The trick is turning profit into a world class airport facility. What we have today is a sorry excuse of an airport. The only reason why it's making a profit is because it's the only way into the "paradise" that nature gave us, and not based on any of its merits.
Lastly, how much of those MRf 300 million are going to enter the public coffers? How much is going to line up the pockets of the crooks running the regime? Answers on a postcard...
Here are a few home truths people,
1, GMR contract was a losing contract no matter how we cut it , brave but foolishly executed decision to kick em out
2. The way Maldives politics is going, before our time is done i wouldnt be surprised even if Umar Naseer joined MDP and was hailed a hero
3. No one will ever be locked up no matter who wins the elections
4. after the elections or in the run up to the elections deals will be made which will safe guard the corrupt
5 . for as long as the most corrupt have the most votes our situation of been shit suckers will not change
6. wake up people and smell the coffee
One day we will have the Airport washed away by a TSUNAMI and then let us fight what to charge
Why just the previous government? What about all the corrupt deals done during the government of maumoon Abdul Gayoom?
We have never received much foreign aid during Nasheed time though Nasheed promise that he will bring 350 million within 21 days from taking his office.
I fact we have never received any donation from any foreign country during Nasheed regime.
Nasheed managed to take 100 million dollars loan from India to manage his daily expensed at the commecial rates and additional USD 10 million from Sri Lanka again at the commercial interest rates.
Yes he had brought GMR which is one of the most corrupted investors in the world where Nasheed had pocketed millions of dollars .
Current government is hundred times better in terms of ecumenic performances.
Foreign aid is more likely to get now than during Nasheed time.
We have now beefed up our "fed" reserves up to USD 350 billion during the last one year. A portion of our "fed" reserve is expected to be utilized in building an airport in Gaa Kurinbee, just adjacent to the harbour that was developed during President Nasheed's regime.
Foreign is aid now flowing to the Maldives just like current the flows in the mangroves of Gaa Kurinbee.
Kurinbee, before you talk about the "fed" reserve of the Maldives, learn how to properly squat and defecate and clean yourself on beaches, or whatever that is left of it,of Gaa Kurinbee. See if you can catch a "valu Kan'bili" from behind!!
Get your facts correct. You sounds sour. Nasheed is ladheenee and agent of zionist. But he is a dame good president.
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