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The International Monetary Fund (IMF) has praised the Maldives government’s decision to increase GST from 6% to 8% and TGST from 12% to 16% to improve the country’s reserve.
According to the statement issued by the IMF after the delegation from IMF visited the Maldives in late June to assess the country’s economic situation, the government’s decision to increase the GST and TGST percentages is a good decision and will bring good growth to the economy. And with the current economic situation it’s a reasonable decision.
Moreover, in the statement MF noted that with the growth of the country’s economy is also growing and it benefits other sectors and the economy is expected to grow by 8.7 percent this year. Also, the country’s inflation is expected to increase by 3.1 per cent with rising food and energy prices. And the maldivian economy is likely to be adversely affected by the decline in the economy of key tourism markets and the increase in financial difficulties.
In addition, IMF expressed concern over the high financial risks caused by the debt. The IMF estimates that the budget deficit will be above MVR 10 billion by the end of the year.
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