The Maldives, a dream destination known for its turquoise waters and luxurious resorts, is implementing a series of tax increases starting late 2024. These changes aim to boost government revenue but may also impact the cost of your idyllic island escape. Here’s everything you need to know to plan smarter and budget better for your next trip to paradise.
What’s Changing?
Several taxes that directly affect tourists are on the rise. Here’s a breakdown:
1. Departure Tax and Airport Development Fee (ADF)
Starting December 1, 2024, travelers will see increases in these fees:
- Economy Class:
- Foreign passengers: From $30 to $50.
- Maldivian passengers remain at $12.
- Business Class: From $60 to $120.
- First Class: From $90 to $240.
- Private Jets: From $120 to $480.
These changes apply to both the Departure Tax and the ADF, meaning double the increase for affected categories.
2. Green Tax
Effective January 1, 2025, the nightly Green Tax for visitors will double:
- Luxury stays (resorts, hotels, or vessels with more than 50 rooms): From $6 to $12 per person, per night.
- Small accommodations (guesthouses and hotels with 50 rooms or fewer): From $3 to $6 per person, per night.
Good news for families: Children under two years old will be exempt from the Green Tax.
3. Tourism Goods and Services Tax (TGST)
From July 1, 2025, the TGST—applied to nearly all tourist-related services—will rise from 16% to 17%.
How Will This Affect Travelers?
These cumulative increases could significantly raise the cost of a Maldivian vacation, particularly for travelers booking luxury stays or private flights. For example, a family of four staying in a resort for a week could face an additional $336 in Green Taxes alone.
Budget travelers may feel the squeeze too, especially when combined with the higher TGST and departure fees.
Why Is the Government Raising Taxes?
The Maldivian government cites a need to address a growing budget deficit and dwindling foreign reserves. The additional revenue will go towards:
- Infrastructure improvements.
- Environmental conservation initiatives.
- Public services to support sustainable tourism.
While the intentions are long-term sustainability and better services, critics argue that these changes might deter cost-conscious tourists.
Frequently Asked Questions (FAQ)
1. When do the new taxes start?
- Departure Tax and ADF: December 1, 2024.
- Green Tax: January 1, 2025.
- TGST Increase: July 1, 2025.
2. Are any travelers exempt?
- Children under two years old will no longer pay the Green Tax starting in 2025.
- Diplomats and transit passengers are exempt from the Departure Tax and ADF.
3. How are these taxes collected?
- Departure Tax and ADF: Collected by airlines or airport operators at ticket purchase.
- Green Tax: Added to your hotel or resort bill.
4. Will existing bookings be affected?
Yes, if your stay or travel occurs after the effective dates, the new rates will apply, regardless of when you booked.
5. How will the funds be used?
Revenue will be channeled into improving infrastructure, supporting sustainability programs, and bolstering public services essential for tourism.
Final Tips for Travelers
Planning a trip to the Maldives? Keep these tips in mind:
- Budget for extra costs: Factor in higher taxes when comparing destinations.
- Book early: Some hotels or agencies might honor pre-increase rates for early bookings.
- Look for exemptions: If traveling with young children, confirm that the Green Tax exemption applies.
The Maldives remains a stunning destination, and while the costs may rise, the allure of its breathtaking beauty and luxury experiences makes it a bucket-list favorite for travelers worldwide.
Would you still book a Maldivian escape despite the rising costs? Let us know in the comments! 🌺
Sources CNN
