On Thursday, the Government outlined plans to reduce public expenditure by MVR 6.6 billion in its proposed 2025 budget.

Finance Minister Moosa Zameer, presenting the budget to parliament for the first time under President Mohamed Muizzu’s administration, highlighted key measures aimed at increasing efficiency in state spending. The reduction plan includes a shift to targeted, direct subsidies to better support those in need, reforms to the Aasandha health insurance scheme for greater sustainability, strategies to manage fiscal risks from oil price fluctuations, a review of state pensions to eliminate redundancies, and structural reforms within State-Owned Enterprises (SOEs).

To boost revenue, the government intends to increase import duties on cigarettes, raise airport tax and related fees, adjust the green tax, introduce a sand dredging fee for private projects, raise the Tourism Goods and Services Tax (TGST), fully apply the destination principle in the GST system, and impose a frequency spectrum charge.

These revenue-boosting steps, along with MVR 11.5 billion in fiscal reforms embedded in the budget, aim to strengthen the Maldives’ financial position while advancing development priorities across key sectors.