29 November 2024 | 18:25

Dream vacation at popular resort may become an unaffordable luxury

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Tengrinews.kz – A vacation at another popular resort will become more expensive, according to TTG Asia.

From December 1, 2024, holidays in the Maldives will become significantly more expensive for tourists due to higher taxes and additional financial requirements. The new measures have caused concern among representatives of the tourism industry, as they are introduced against the backdrop of a difficult recovery from the COVID-19 pandemic and the financial crisis in the country.

Increase in airport tax

One of the main changes will be an increase in the airport tax for foreign passengers. For economy class, it will increase from $30 to $50 (from about 15 450 to 25 750 tenge). For business class, the amount will increase from $60 to $120 (from 30 900 to 61 800 tenge), and for first class passengers, the tax will rise from $90 to $240 (from 46 350 to 123 600 tenge). For local passengers, the tax will also increase, but to a lesser extent.

Additional changes are expected in taxes on tourist accommodation. From July 2025, the Tourism Goods and Services Tax (T-GST) will increase from 16% to 17%. This will be the next stage of increase, since in January 2023 this tax increased from 12% to 16%. In addition, from January 2025, the so-called "green tax" - a daily fee for each tourist - will double. For large resorts (over 50 rooms), it will be $12 per day (about 6 180 tenge), and for small resorts - $6 (about 3 090 tenge).

New currency exchange requirements

From January 2025, resorts where the average room rate exceeds $800 (about 412 000 tenge) per night will be required to exchange $500 (about 257 500 tenge) per tourist into local currency. This applies not only to regular guests, but also to representatives of tour operators and journalists, even if they do not generate income. This is a concern, since most of the resorts' expenses - from purchasing food to paying salaries - are made in dollars. Industry representatives say that these measures could exacerbate financial difficulties and reduce the attractiveness of the Maldives as a tourist destination.

Reasons and consequences of the new measures

The tax increase is related to the financial crisis that has engulfed the country. Foreign currency reserves have fallen sharply - from $748 million in 2023 to $492 million in May 2024. At the same time, the country's external debt continues to grow and may reach $1 billion by 2026.

The authorities note that they are forced to take urgent measures due to the difficult economic situation. However, representatives of the tourism industry are concerned about the consequences of the new rules. According to one of the resort owners, "the high taxes will kill the industry." Some operators have already stated that they will be forced to cover the additional costs at their own expense, since many tour packages are sold in advance and it is impossible to revise prices.

Forecasts and hopes

Despite all the challenges, the Maldives remains a popular tourist destination. The authorities hope that the number of tourists will increase from 1.5 million in 2024 to 2.2 million in 2025. However, industry representatives are calling on the government to reconsider the timing of the new taxes to give the industry time to adapt to the changes. Those planning a trip to the Maldives should take into account the increased costs and check with their tour operator in advance.

If you are looking for a place to spend your holiday in December, read our selection.

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