Siyam slams Maldives' tax hikes; calls forex rule 'robbery'

Prominent tourism businessman Ahmed Siyam Mohamed on Monday voiced sharp criticism of the Maldivian government's economic policies, calling the mandatory exchange of $500 in foreign earnings per tourist to the state "robbery."

Speaking on Raajje TV's "Fashaa Iru" programme, Siyam, who heads the Sun Siyam Group—one of the Maldives' largest resort operators—argued that such measures, along with sudden increases in tourism-related taxes, are detrimental to the industry and the broader economy.

Siyam strongly objected to the rule requiring resorts to exchange $500 of their foreign exchange earnings per tourist with the state, arguing it is impractical and damaging. He highlighted that many resorts offer packages that include free stays for children, which makes it impossible to comply with such mandates.

"When you say to exchange $500 per head, shouldn't you consider how the industry operates?" Siyam questioned. "How can you exchange what you don’t receive? This policy threatens the financial stability of resorts and could lead to the collapse of our businesses."

He likened the policy to taking "something halal in my hand," calling it outright theft.

The tourism tycoon also criticised the government's sudden decision to hike tourism-related taxes without sufficient warning, claiming it has caused severe financial strain on businesses.

"Resorts sign agreements with tour operators one or two years in advance, locking in prices," he explained. "When taxes increase unexpectedly, it becomes impossible to pass on the additional cost to operators. This leads to cancellations or forces resorts to absorb the extra costs."

Siyam revealed that his group alone faces an additional $12 million in taxes over the next three years due to the changes, a burden he says will make it harder to repay the substantial loans taken to develop resorts.

He warned that policies undermining the tourism sector, which has been the backbone of the Maldivian economy for five decades, could have far-reaching consequences.

"Tourism isn't just about resorts—it sustains the entire country," Siyam noted. "Fishermen go fishing with subsidies funded by tourism taxes. If you harm tourism, you harm the entire economy."

Siyam cautioned that excessive interference in the sector could erode investor confidence, disrupt employment, and destabilise the nation.

Siyam urged the government to engage in dialogue with industry stakeholders to find workable solutions rather than enforcing unsustainable policies.

"If you talk to us about what can be done, we will cooperate," he said. "But forcing us into untenable positions will only destroy companies, jobs, and livelihoods."