The state’s U.S. dollar revenue has surged manifold over the past 13 years, due to several changes in the tax system, tax rates as well as the expansion of the economy of the island nation.

The state had received at least USD 1,500 million by the end of July 2024.

A modern tax system was established in the Maldives during the former administration of now main opposition Maldivian Democratic Party (MDP), back in 2011.

The Maldives Inland Revenue Authority (MIRA) was established and the state's revenue was regularly shared with the public.

A robust system was established in the country where accurate revenue information, whether good or bad, was available to the public whenever required.

Over the past 13 years, due to various changes in the tax system, tax rates, and the expansion of the Maldivian economy, the state's dollar revenue has surged significantly.

As such, the revenue received by MIRA by the end of July this year has increased by nine percent in comparison to the revenue received by the end of July 2023.

Further, the dollar revenue has increased by seven percent.

MIRA’s reports show that they have collected USD 43 million more so far this year in comparison to the same period of last year.

In addition to the dollars collected by MIRA as taxes, there are many other ways for the state to attract dollars as revenue.

The largest revenue among them comes from state-owned companies. State Trading Organization (STO) and Fuel Supplies Maldives (FSM) conduct fuel business transactions with resorts in U.S. dollars. U.S dollars are also brought in through transactions made by Allied Insurance as well as through gas supplied to resorts by Maldive Gas. Further, MTDC also receives rent from leased resorts in U.S. dollars. Island Aviation earns dollars from selling tickets to tourists using seaplane operations, plane operations and domestic flights.

The dollar revenue of Airports Company is incomparable to all these companies. According to the company's 2023 last quarter report, the company earned a revenue of MVR 7,000 million last year. As Airports Company is an international operation, it is estimated that at least 80 percent of the company's revenue will be in dollars.

This means that it is a large operation that earned about USD 370 million in 2023 alone.

At this rate, the state will receive approximately USD 200 million in revenue from Airports Company's operations alone in the first seven months of this year.

Further, the fishing industry, which the incumbent administration has miserably failed to manage, has exported 28,000 tons so far this year, according to the central bank, Maldives Monetary Authority (MMA). Even at the lowest rate, exporting 28,000 tons of fish will bring at least USD 40 million to the Maldives.

Similarly, Maldives Ports Limited (MPL) is also a company that attracts dollars for the state.

The state has so far not publicized an official financial report indicating that there has been a decrease in the amount of U.S dollars attracted by the Maldives.

Despite the number of tourists visiting the island nation from neighboring India plunging significantly due to the harassment by top government officials, the total number of tourist arrivals Maldives has recorded so far this year, has surged by 10 percent in comparison to the same period last year.

While there is no sign of even a slight economic downturn in relation to revenue, what is observed is a massive influx of dollars.

By the end of July 2024, the state received at least USD 1,500 million. This is at least 10 percent more than the dollar revenue received for the same period last year.

Next is the matter of imports. Another way foreign currency expenditure would increase significantly is if a large expenditure on imports. According to statistics of the Maldives Customs Service, imports so far this year amount to USD 291 million worth of goods per month. The average monthly import value for last year was USD 290 million, which is not much of a difference.

This means that there wasn’t any significant growth in U.S. dollar expenditure on import costs. These are facts that the government cannot deny, as proven through readily available information.

The government holds all the powers to run the country in its grip. They have control over both the governance and boasts a supermajority in the People’s Majlis. A bill introduced in the morning can be turned into law by noon the next day. There are plenty of opportunities to implement any policy the government desires.

Despite this, hasty and impulsive decisions are being made without a trace of responsibility, with expenditures made from the state treasury. To show that Indian military assistance is unnecessary after 'falling out' with India, two drones were purchased at an inflated price of USD 35 million. While India was offering concessions on a loan taken under the relationship between both countries, it was abruptly repaid. When the People’s Majlis opposed the Ras Malé reclamation project, they forcefully pushed ahead, paying 'Raju' millions to kick start the project. We're talking about payments of at least USD 90 million.

On the other hand, the state treasury is snowballing expenditures by increasing the number of political employees and offering jobs on silver platters. The changes in the payroll of state-owned companies also show the extent to which companies have distributed jobs. Many unnecessary employees have been added to government companies. There is no point in discussing mounting expenses when the treasury is being depleted. Unnecessary ministries and offices are being established. Let’s not get started on the ceremonies, celebrations and meetings.

As a result, capital expenditure has been sharply slashed, and the development and progress that the people have been eagerly hoping for has come to a complete standstill.

This is not about a newly formed nation by a group of individuals. Rather, it draws the focus on a new group that has taken over a country that has had a world-class tourism industry and a reasonably advanced fishing industry at its disposal. It is a country with international airports, domestic ports, well-established infrastructure and one that has been receiving relatively adequate income from these sources. It is a country with a good tax system, an established sovereign development fund with reliable mechanisms for income generation.

To put it briefly, the issue is not with the country itself. The real issue at hand is that those who took over the reins, promising everything would be “easily accomplished”, are now struggling to manage affairs effectively, with which the country’s affairs are on wafer-thin ice.