Revenue growth and lower spending narrow deficit, latest report shows
Tax revenue rose by 8.5 per cent to MVR 25.2 billion, compared with MVR 23.3 billion in the same period last year, largely driven by higher GST receipts.
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The Weekly Fiscal Developments Report for 20 November 2025, issued by the Ministry of Finance and Planning, shows continued growth in state revenues, declining deficits and sustained investment in development projects and social programmes.
Total revenue and grants reached MVR 33.5 billion, an increase of 9.5 per cent compared with MVR 30.6 billion in the same period last year. Total expenditure fell by 12.6 per cent to MVR 35.1 billion, down from MVR 40.1 billion. As a result, the overall deficit for the period narrowed significantly, declining from MVR 9.5 billion in 2024 to MVR 1.5 billion this year, a reduction of around 84 per cent.
Both tax and non-tax revenues recorded growth. Tax revenue rose by 8.5 per cent to MVR 25.2 billion, compared with MVR 23.3 billion in the same period last year, largely driven by higher GST receipts.
Total GST revenue rose by 12.0 per cent to MVR 13.7 billion, up from MVR 12.2 billion. Within this, GGST increased by 8.0 per cent to MVR 4.6 billion, while tourism GST grew by 14.2 per cent to MVR 9.1 billion. Green tax revenue more than doubled, rising 107.1 per cent to MVR 1.9 billion from MVR 914.0 million. Departure tax revenue increased by 60.5 per cent to MVR 1.6 billion.
Non-tax revenue also increased strongly. Airport development fee collections rose by 150.5 per cent to MVR 1.3 billion, while resort land rent increased by 2.1 per cent to MVR 1.5 billion. Overall, non-tax revenue grew by 17.6 per cent to MVR 8.0 billion, up from MVR 6.8 billion.
Tax revenue accounted for 75.2 per cent of total revenue and grants, with non-tax revenue contributing 23.9 per cent. As of 20 November, the government had received approximately 84 per cent of the estimated MVR 39.8 billion in total revenue and grants projected for the year.
On the expenditure side, the government reported reduced overall spending while prioritising essential services and key projects. Recurrent expenditure rose slightly from MVR 29.2 billion to MVR 30.0 billion. Spending on salaries, wages and pensions increased by 6.6 per cent to MVR 12.1 billion, partly due to the pay harmonisation programme and efforts to improve service delivery.
Capital expenditure declined from MVR 10.9 billion to MVR 5.0 billion, a reduction of 53.7 per cent, in line with the government’s focus on reprioritising and streamlining major projects.
Although the overall balance turned to deficit by late October due to ongoing development projects and the implementation of the wage harmonisation policy from 1 November 2025, the government maintained a surplus for the first 40 weeks of the year. As of 20 November, the overall balance stood at a deficit, while the primary balance recorded a surplus of MVR 2.6 billion.
