The Maldives has achieved a remarkable milestone in environmental financing, with Green Tax revenues soaring to MVR 966.3 million in 2025—an impressive 89% increase from the previous year. This substantial growth reflects not just economic recovery, but a strategic approach to sustainable tourism development.
Implemented in stages since 2015 and recently revised in January 2025, the Green Tax now stands at US$12 for resorts and US$6 for guesthouses. These increased rates have dramatically transformed environmental funding, creating a robust financial mechanism for climate resilience.
The first quarter of 2025 demonstrated remarkable economic and environmental synergy. Green Tax collections reached MVR 528 million, representing 8.1% of USD-denominated revenue—second only to Tourism Goods and Services Tax (TGST) and Income Tax. This surge coincides with a 5.7% rise in tourist arrivals and a 3.3% increase in bed nights compared to 2024.
While overall tourism performance shows promise, analysts note a slight moderation in stay durations. The average tourist visit experienced only a 0.7% bed night growth, prompting economists to revise the Gross Value Added (GVA) growth projection to 2.5% for 2025.
December 2024 emerged as a pivotal month, with Green Tax collections hitting MVR 109.5 million. K. Atoll, R. Atoll, and Adh. Atoll led contributions, underscoring the high-end tourism sector’s environmental commitment.
The Maldives Green Fund—the primary recipient of these revenues—has become a powerful catalyst for climate-resilient infrastructure. In December 2024 alone, MVR 172.4 million was strategically deployed across critical projects:
- HA. Maarandhoo: MVR 19.3M for water and sewerage infrastructure
- AA. Feridhoo: MVR 17.7M for advanced sanitation systems
- Addu City: MVR 12.4M for a cutting-edge regional waste management facility
With a year-end fund balance of MVR 1.61 billion, the Green Fund exemplifies how targeted environmental taxation can drive meaningful community-level solutions.
The Plastic Bag Fee—a complementary policy under the Waste Management Act—offers additional insights. Despite collecting MVR 1.55 million in Q1 2025 (a 46.5% decline from 2024), the reduced figure signals success in its primary objective: decreasing single-use plastic consumption.
For businesses, particularly in tourism and infrastructure, these developments signal critical strategic implications:
- Emerging investment opportunities through public-private environmental partnerships
- Increasing regulatory compliance expectations
- Enhanced positioning for sustainability-focused international investors
As the Maldives celebrates Environment Day, these fiscal innovations represent more than revenue streams—they are transformative vehicles carrying a national commitment to climate adaptation and intergenerational environmental stewardship.
