Government revenue collected through the Maldives Inland Revenue Authority fell in May as the sharp decline in tourist arrivals during April reduced income from tourism sales, occupied bed nights and passenger-related charges. MIRA collected MVR 2.05 billion during the month, representing a 5.8 per cent decline from May 2025, while collections from revenue categories included in the monthly forecast were 0.3 per cent below projections.
The decline was concentrated in tax revenue, which fell by around 9.7 per cent to MVR 1.68 billion. Non-tax revenue increased by 17.1 per cent to MVR 365.6 million, helping to offset part of the reduction. The figures indicate that the weaker monthly performance was not spread evenly across the revenue system, but was largely driven by taxes directly connected to tourism activity.
Tourism Goods and Services Tax recorded the largest fall, declining from about MVR 962.9 million in May 2025 to MVR 755.9 million this year. Green Tax revenue also fell by 32.4 per cent to MVR 138.6 million. Together, the reduction in these two taxes amounted to approximately MVR 273 million, more than twice the overall year-on-year decline in total revenue, as stronger income tax receipts and several non-tax revenue categories compensated for part of the loss.
The main reason for the reduction was the weaker tourism performance recorded in April, as revenue generated during that period was largely paid to MIRA in May. Tourist arrivals fell by 25.6 per cent compared with April 2025, while occupancy declined from 59.8 per cent to 48.9 per cent. The slowdown followed disruptions to international travel linked to conflict in the Middle East, including interruptions to airline schedules and transit routes commonly used by visitors travelling to the Maldives.
Fewer tourists and lower occupancy reduced the value of taxable transactions generated by resorts, guesthouses and other tourism businesses. Accommodation, food and beverage sales, transfers, excursions and other services all contribute to TGST collections, meaning a decline in visitor numbers can reduce revenue across several parts of the tourism economy at the same time. The fall in TGST occurred despite the rate having increased from 16 per cent to 17 per cent in July 2025, showing that the contraction in taxable tourism sales was large enough to outweigh the effect of the higher rate.
Green Tax was affected more directly by the reduction in occupied bed nights because it is charged according to the number of nights visitors spend at registered tourism establishments and vessels. Airport Development Fee, Departure Tax and Tourism Land Rent also recorded lower collections, while reduced receipts from expatriate quota fees and Corporate Social Responsibility fees placed additional pressure on the monthly total.
The decline does not appear to have been caused mainly by weaker enforcement. MIRA recovered MVR 382 million from overdue payments during May through formal recovery action, dues clearance, instalment plans, reminder calls and other measures. These collections helped narrow the shortfall, but payments recovered from previous deadlines could not fully replace the revenue lost from weaker current economic activity.
May’s performance was also partly supported by one-off and non-tax collections. Lease period extension fees generated MVR 51.9 million during the month, compared with no collection from the category in May 2025. Stronger income tax receipts also helped prevent a deeper overall decline, illustrating how revenue sources outside tourism can provide some protection when visitor-related collections weaken.
The monthly fall has not yet reversed the stronger revenue performance recorded earlier in the year. Total MIRA collections between January and May reached MVR 16.38 billion, an increase of 14 per cent from the corresponding period of 2025. However, the May figures show how quickly a decline in tourist arrivals can affect several major government revenue streams and place pressure on collections, particularly when the tax system remains heavily dependent on tourism demand, occupancy and visitor spending.
