Government revenue for the year 2020 dropped by 37.7 percent due to the economic and fiscal repercussions of the COVID-19 pandemic, according to Maldives Inland Revenue Authority (MIRA).
Official statistics show that MIRA collected MVR 10.5 billion as revenue last year, compared to MVR 16.79 billion in 2019.
The authority attributed the decrease to the pandemic's impact on the tourism industry, the backbone of the Maldivian economy.
At 41.1 percent, Goods and Services Tax (GST) contributed to the majority of revenue with MVR 4.31 billion, followed by Income Tax, which was newly implemented in 2020. MIRA collected MVR 1.89 billion as Income Tax, while Business Profit Tax contributed MVR 1.77 billion.
MIRA also generated MVR 702.78 million from tourism land lease and MVR 31.95 million from Green Tax.
The US Dollar income included in the 2020 revenue was 296.84 million.
The restrictions on international travel in 2020 due to the ongoing pandemic left Maldives' heavily tourism reliant economy in an extremely vulnerable state. In mid-April last year, the World Bank projected that Maldives would be the worst-hit economy in the South Asian region due to COVID-19.
However, following the border reopening on July 15, 2020 after a four-month closure to curb the spread of infections, the number of tourist arrivals has steadily begun to increase, renewing hopes to revitalise the economy.
Despite the entire industry screeching to a halt due to preventive measures taken to curb the spread of the virus, Maldives hit its target for 500,000 tourists in 2020, with an impressive recovery curve.
With renewed hope, the government expects to attract over 1.5 million tourists in 2021. Minister of Tourism Dr Abdulla Mausoom, on several occasions, stated that this year would be a "very successful" year for Maldivian tourism.