Frankly Speaking

The increase of TGST from 16% to 17% is not expected to have a negative effect. Why? Because even with this adjustment, the tax rate remains reasonable compared to many other destinations. With new resorts opening, an expanded range of tourism products across the Maldives, and a strong collective marketing strategy, we are well positioned to tap into emerging markets and further diversify our visitor base. In addition, enhanced PR and marketing initiatives will support continued growth in both arrivals and overall revenue.

We already have bookings secured until the end of the year, so there will not be much of an impact for now, as most hotels are likely to absorb the 1% increase since contracts were signed last year. However, from next year, we expect challenges in maintaining higher occupancy levels, as the Maldives continue to become more expensive while our competitors and similar destinations are becoming more affordable for travelers.

I don’t think the small TGST increase will make a significant difference. The real issue is that we are not marketing our tourism products effectively relative to their potential. With stronger global promotion highlighting the Maldives’ unique experiences, luxury resorts, and natural beauty, we could attract more visitors and avoid feeling pressure from such minor tax adjustments.

At the same time, the government should take a long-term view by projecting tourism capacity and bed growth for the next 3–4 years and structuring taxes in a sustainable, growth-focused manner. With smarter marketing, strategic planning, and capacity-based taxation, we can continue to grow arrivals, improve occupancy, and maximize revenue without overburdening the industry.