State expenditure exceeded revenue by MVR 13 billion in 2020

Velana International Airport. (Sun Photo/Fayaz Moosa)

Records released by Finance Ministry show the State spent MVR 27.3 billion in 2020 while it received a lower MVR 14.5 billion as revenue, resulting in a fiscal deficit of MVR 13 billion.

Maldives originally passed a budget of MVR 35.9 billion for 2020, but later reduced the budget and cut down expenses due to the severe impact of the COVID-19 pandemic on the economy. The previously projected annual revenue was cut from MVR 29.9 billion to MVR 15 billion, and the overall budget was cut to MVR 31 billion.

Records released by Finance Ministry show the State collected MVR 10.6 billion as tax revenue in 2020, a drop from the MVR 16.5 billion collected as tax revenue in 2019. Meanwhile, non-tax revenue also declined from MVR 6.5 billion in 2019 to MVR 3.1 billion in 2020.

The State spent MVR 9.84 billion on salaries, wages and pensions in 2020, only a slight increase from the MVR 9.83 billion in 2019. MVR 141.3 million was spent on State sponsored trips in 2020, a significant decrease from the MVR 230.7 million in 2019.

The State spent MVR 1.2 billion on Aasandha health insurance services in 2020, a slight drop compared to the MVR 1.3 billion in 2019.

Finance Ministry’s records also show MVR 1.18 billion was spent on loan repayments by the end of 2020.