Champa Uhchu Calls for Suspension of New Foreign Income Regulations

Prominent Maldivian tourism entrepreneur, ‘Champa Uhchu’ Mohamed Manik, has called on the government to suspend new regulations mandating that foreign income from tourism be deposited in local banks. 

In a letter addressed to the Maldives Monetary Authority (MMA), Manik raised concerns that the regulation, which requires resorts to deposit USD 500 per tourist, would lead to significant financial strain on businesses in the tourism sector.

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The letter, sent through his company Kurehdhoo Holdings, criticised the measure as unjust, arguing that it unfairly targets the tourism industry. Manik requested a review of the policy, citing a lack of adequate consultation with industry stakeholders before the regulation was enacted.

Key points raised in Manik’s letter include:

• Insufficient consultation with industry professionals, given the significant implications of the decision.
• The regulation’s immediate enforcement following its publication in the government gazette, without a reasonable adjustment period for businesses.
• A standardised deposit amount for all tourists, irrespective of their length of stay at resorts.
• Application of a uniform standard across all resorts, which Manik argued is financially unviable.
• Lack of exemptions for specific groups of guests, such as those visiting on familiarisation or sponsored trips.
• Compulsions to cut operational costs, potentially impacting staff welfare.
• Ambiguity around the regulation’s applicability to resorts with substantial investments, often exceeding USD 70 million, and those with existing debts.

Manik, who has over 40 years of experience in the tourism industry, expressed his commitment to supporting the government on crucial matters but voiced concerns about the sustainability of these regulations. He highlighted the already substantial taxes, fees, and rents paid by tourism businesses, arguing that compliance with MMA’s guidelines would place an unsustainable burden on the sector.

He warned that the new regulations could erode investor confidence, deter tourism industry investors, and ultimately harm the Maldivian economy.