The Airline Operators Association (AOA) has expressed concerns over the government’s proposed hike in passenger departure taxes, set to take effect next month.
In a statement, AOA said the hike could severely impact the tourism and aviation sectors, which are vital to the Maldivian economy.
It said a steep increase in departure taxes could make the Maldives less attractive to travelers, particularly those who are price-sensitive.
This may result in reduced tourist arrivals, lower hotel occupancy rates, and decreased spending, which would ultimately harm the economy and reduce government revenue rather than boost it.
AOA noted the proposed tax increase contradicts guidelines set by the International Civil Aviation Organization (ICAO).
Aviator Maldives reported that ICAO’s Doc 9082 stipulates that airport charges must be cost-related and implemented gradually. The sudden 100 percent hike, untied to any improvement in services, disproportionately affects international travelers and fails to adhere to the gradual implementation approach recommended by ICAO.
The AOA expressed dissatisfaction with the lack of adequate consultation with industry stakeholders.
It urged the government to explore other avenues for generating revenues and recommended phasing in any tax increases, giving airlines and tourists time to adjust and preventing a sudden shift in travel trends toward competing destinations like Sri Lanka, Mauritius, and Seychelles.
The AOA also raised concerns over the Airport Development Fee (ADF), which was increased in 2022 with little visible improvement in services at Velana International Airport. Without enhanced facilities, travelers may become dissatisfied, potentially harming the Maldives’ reputation as a top-tier travel destination.
