While import duty constitutes a major portion of state revenue, due to the increase in uncollected funds owed to Customs, the central bank, MMA, advised today to transfer the collection aspect under the oversight of the Ministry of Finance.
In the advice given by the MMA to the People's Majlis regarding the state budget projected for next year, it was stated that the budget highlighted that uncollected funds owed to Customs have increased.
MMA advised doing five things to increase state revenue, which includes conducting duty collection processes under the oversight of the Ministry of Finance.
"Import duty is a major part of state revenue. It has been highlighted in the budget that the funds owed to the Maldives Customs Service which remain uncollected have also increased. In this regard, we view that bringing Customs' fiscal (revenue administration) under the oversight of the Ministry of Finance and Public Enterprises is a good thing," the MMA stated in its advice provided to the People's Majlis Budget Committee.
Revenue-related advice
- Devising a robust plan on how to act if tourism is further stalled due to the Middle East war, alongside diversifying the economy.
- Acknowledging that revenue received as corporate income tax can be increased.
- Further strengthening revenue administration.
- Changing Customs' revenue administration to a matter overseen by Finance.
- All relevant authorities working together to obtain the money targeted to be raised by increasing resort rent and from other fees of the Ministry of Tourism.
Along with advising on increasing revenue, MMA also advised on reducing state expenditures. One of those measures is implementing the plan to reform Aasandha, which includes the policy where high-income earners are required to pay a co-payment for Aasandha.
Keeping expenditures made in foreign currency at a sustainable level was also a measure proposed by the MMA to reduce expenditures.
The authority also advised prioritizing projects that have already been commenced when spending on projects run from the state budget. The advice given by the MMA includes taking 11 expenditure-reducing measures, encompassing these matters.
