The Finance Ministry announced on Wednesday that the state’s revenue collection for the past year exceeded the budget projections by 19.7%. In a comprehensive statement, the Finance Ministry presented last year’s budget outcomes, providing a detailed breakdown of the budget’s execution and the resulting financial situation.
In the budget approved by parliament last year, the state initially projected revenue and grants at MVR 24.2 billion. However, by the end of the year, the state had collected a total of MVR 29.1 billion in revenue and grants, representing a significant 19.7% increase over the initial estimates set in the previous year’s budget.
The government’s revenue surpassed expectations at the close of 2021, partly due to the nation’s economic recovery from the challenges posed by the COVID-19 pandemic, alongside a growth rate that exceeded earlier forecasts. One of the main factors contributing to the revenue increase in the current year compared to the projections from the previous year’s budget was the higher-than-expected number of tourists visiting the country.
The statement also highlighted the effective management of the pandemic, attributed to the government’s rigorous COVID-19 control measures in 2021. This positively impacted the country’s economic situation for that year, surpassing initial predictions. This improvement was primarily due to state tax revenue outperforming initial estimates and higher-than-expected revenue from resorts, land sales, land conversion fees, and non-tax revenue, which exceeded previous projections for the last fiscal year.
A substantial portion of the state’s revenue came from the Goods and Services Tax (GST). Last year, GST revenues amounted to MVR 3.1 billion, marking a 10.7% increase over the estimates outlined in the previous fiscal year’s budget results statement.
While tax and non-tax revenues exceeded expectations, grant receipts for the state were notably lower, registering an 83.6% decrease compared to the budget estimates for the same year. According to the Finance Ministry’s budget results statement, last year’s budget had anticipated receiving MVR 2.9 billion in grants, but the state received only MVR 1.1 billion in subsidies that year.