Govt reduces tourism island lease acquisition costs in 6 atolls

The Ministry of Tourism and Environment has reduced the lease acquisition costs for islands offered for tourism development under the government's cross-subsidy scheme in six atolls.

The ministry announced revisions to the rates used to calculate lease acquisition costs on Sunday, lowering the base rates, per-hectare charges and premiums applicable to larger islands.

The changes apply to islands in Haa Alifu, Haa Dhaalu, Shaviyani, Thaa and Laamu atolls, as well as Addu City.

The ministry had previously revised the lease acquisition rates for islands and lagoons in these areas in June 2025.

Under the latest changes, the base rate for islands in Haa Alifu, Haa Dhaalu, Shaviyani and Thaa atolls has been reduced from USD 500,000 to USD 400,000. The per-hectare rate has also been lowered from USD 50,000 to USD 35,000.

For Laamu Atoll, the base rate has been reduced from USD 800,000 to USD 700,000, while the per-hectare charge has fallen from USD 75,000 to USD 60,000.

In Addu City, the base rate has been lowered from USD 500,000 to USD 400,000, with the per-hectare rate reduced from USD 50,000 to USD 35,000.

The ministry has also reduced the location or size premium applicable to land exceeding 40 hectares in all six areas. The premium has been halved from USD 1 million to USD 500,000.

No size premium is charged for land measuring between 20 and 40 hectares, a provision that was already in place before the latest revision.

Under the revised formula, the lease acquisition cost is calculated by adding the base rate to the per-hectare rate multiplied by the size of the land, together with any applicable size premium.

The reduced rates will remain applicable for a two-year period beginning from the previous revision in June 2025. The ministry's announcement states that the concession period will expire on 25 June 2027.

The latest announcement does not introduce any changes to the lease acquisition costs applicable to lagoons.