ESCALATING taxes are putting a damper on the Maldives’ allure, with the impact not hitting home yet but expected to be felt keenly in the coming months.
Having introduced a new 3.5 per cent tourism goods and services tax (TGST) in January, to the chagrin of international tour operators who complained of the short notice given, President Mohamed Nasheed announced last Friday that the tax might be further increased to six per cent.
Although no time frame was mentioned, UK-based operators said they had been advised by hotels in Maldives to expect a hike by next January.
Chic Locations UK director, David Kevan, said the general concern was that the destination was beginning to outprice itself, to the advantage of rivals such as Mauritius and Sri Lanka.
“Most operators have been concerned by the Maldives’ pricing even before the latest round of tax increases.
“I don’t think you will find too many UK operators looking at growth for the destination over the next couple of years. In fact, I think most would be more than happy to see a single-digit increase in bookings,” he said.
UK, once the biggest visitor-generating market for the destination, was overtaken by China last year. Germany is in third place.
– Read more in TTG Asia, May 27 issue
