The Maldives tourism industry is facing concerns from foreign tour operators and resort operators over two government measures covering tourism tax and foreign currency conversion.
Some foreign tour operators have indicated that they may reconsider marketing the Maldives ahead of a 17 per cent Tourism Goods and Services Tax (TGST) on inbound tourism products and related agency and booking services supplied by overseas businesses, which takes effect on October 1, 2026.
Separately, resorts are required to convert 40 per cent of their monthly gross sales in foreign currency into Maldivian rufiyaa from September 1, up from the previous requirement. The measure has raised concerns among resort operators over their foreign currency requirements.
Mohamed Khaleel, a senior tourism advisor to the president, resigned in late August, saying the measure would put pressure on resort operators and affect investor confidence.
“Both moves come at a bad time because there is active competition in tourism markets and the Maldives would be adversely affected by these developments,” a senior manager at a foreign tour operator told TTG Asia on condition of anonymity.
According to an official from the Maldives Association of Travel Agents and Tour Operators (MATATO), several tour operators attending the Arabian Travel Market in Dubai from September 14 to 17 expressed concerns over the new tax on foreign operators.
The Maldives currently levies a 17 per cent TGST, a 10 per cent service charge and a Green Tax of US$12 per person per day at most tourist establishments. From October 1, the 17 per cent TGST will also apply to inbound tourism products and related agency and booking services supplied by businesses without a fixed place of business in the Maldives.
Affected foreign operators will be required to register with the authorities, a requirement that has also raised concerns among agents over administration and the handling of commercial and customer information.
Resort operators have separately raised concerns over the 40 per cent foreign currency conversion requirement, saying a substantial share of their expenses, including salaries, imports and leases, is paid in foreign currency.
“What is happening is that resorts have surplus local currency, due to the forced conversion rules, without any use for this currency,” one hotel manager said.
Both moves by the government come amid a shortage of foreign currency to service foreign loans for infrastructure projects, as well as concerns over tax leakage and compliance with tax payment rules among some resorts.
MATATO and the Maldives Association of Tourism Industry have raised concerns over the measures, while associations representing European, French and Italian travel businesses have called for the new tax on foreign operators to be repealed or postponed to allow further industry consultation.
At a government meeting on September 15 to discuss the tax, attended by about 800 industry representatives, participants raised concerns and called for more time for consultation.
The European Travel Agents’ and Tour Operators’ Associations (ECTAA) said operators could have to absorb the new GST on packages already sold, reducing their margins. “For these reasons, tax changes of this nature require substantial advance notice,” it said.
French associations SETO – Syndicat des Entreprises du Tour Operating and EdV (Les Entreprises du Voyage) said the registration requirement could increase administrative and financial costs for smaller French operators selling a limited number of Maldives packages, potentially prompting some to reduce or discontinue their programmes.
ASTOI Confindustria Viaggi, the national association of Italian tour operators, also raised concerns over requirements to provide commercially sensitive and personal information.
The Maldives is targeting 2.4 million to 2.5 million tourist arrivals in 2026, compared with 2.2 million in 2025, although travel demand this year could also be affected by tensions in the Middle East, a transit hub for many European travellers.
