The Maldives recorded a notable increase in government revenue during the first half of the year, with stronger tax collections helping push total revenue and grants to MVR 22.4 billion, according to the latest fiscal figures released by the Ministry of Finance and State-Owned Enterprises.
The ministry’s Weekly Fiscal Developments report, covering the period up to July 2, shows that government income rose by MVR 2.1 billion, or 10.4 percent, compared with the MVR 20.3 billion collected during the same period last year.
Tax revenue remained the government’s largest source of income, accounting for MVR 17.3 billion of total collections. This represents an increase of MVR 2 billion, or 13 percent, from the corresponding period in 2025.
According to the ministry, the improvement was driven primarily by higher collections from Corporate Income Tax (CIT) and the Goods and Services Tax (GST).
Corporate Income Tax generated MVR 1.7 billion, an increase of MVR 97.7 million compared with the same period last year. The ministry attributed the growth to increased business activity and the timing of corporate tax filings.
GST also continued to be a major contributor to state finances, with collections reaching MVR 9.6 billion during the reporting period. Of that amount, MVR 6.6 billion came from Tourism Goods and Services Tax (T-GST), while General GST contributed MVR 2.9 billion. Overall GST revenue increased by MVR 835.4 million, or 9.6 percent, year-on-year.
While revenue strengthened, government expenditure also increased significantly.
The report shows total expenditure reached MVR 23.4 billion, up 21.7 percent from MVR 19.2 billion recorded during the same period in 2025.
The ministry said higher spending was largely driven by increased expenditure on salaries and allowances for public sector employees, alongside higher subsidy payments.
Despite continued pressure from rising global oil and commodity prices linked to tensions in the Middle East, the government said it had allocated an additional MVR 1.4 billion towards subsidies this year to help maintain stable prices for essential goods and services.
Spending on salaries and wages alone totalled MVR 3.7 billion, representing a 13.9 percent increase compared with the previous year. Combined expenditure on salaries and pensions reached MVR 8 billion.
The report also shows recurrent expenditure stood at MVR 20.3 billion, while capital spending on development projects increased to MVR 3 billion, reflecting continued investment in public infrastructure.
Despite the increase in expenditure, the government recorded a primary surplus of MVR 1.7 billion, indicating that revenue exceeded operational expenditure before interest and debt servicing costs are taken into account.
However, after including all government expenses, the overall fiscal balance remained in deficit, with the ministry reporting a budget deficit of MVR 975.9 million.
The Maldives has been pursuing fiscal consolidation measures in recent years aimed at strengthening public finances, improving revenue collection and managing expenditure while continuing to invest in infrastructure and public services. The latest figures suggest tax revenues continue to play a central role in supporting the government’s fiscal position.
