The Parliament has approved an amendment to the Tourism Act, sending the bill to the Parliamentary Committee on Economic Affairs for further scrutiny.

The bill, submitted by Thimarafushi MP Ahmed Riyaz on behalf of the Government, was initially passed with the support of 43 lawmakers, while 9 voted against it.

After its initial approval, the bill was referred to the Parliamentary Committee on Economic Affairs for comprehensive review and potential refinements.

One of the significant changes introduced in the amendment is the revision of Section 4(b) of the Tourism Act. Under this provision, inhabited islands, islands within cities, and uninhabited islands under city council jurisdiction may be designated for tourism development at the discretion of the President. However, the amendment stipulates that only tourist guesthouses and tourist hotels may be developed in these designated areas.

Another major revision concerns Section 5 of the Tourism Act, which currently allows islands, land, and lagoons to be allocated for the development of tourist resorts or integrated tourist resorts under a cross-subsidy model, aligned with an economic or social policy intended to benefit the state.

The amendment expands this provision, authorising the Government to allocate islands, land, and lagoons for tourism development under any "important policy laid down by the Government." This modification grants the Government greater flexibility in formulating tourism development strategies, extending its discretionary authority beyond predefined economic or social policies.

The second amendment in the proposed bill introduces a revised process for resort lease extensions. Under the new provisions, if the lease of an island or lagoon with a 50-year tenure is extended by 49 years within six months of the amendment's implementation, a one-time upfront payment of USD 5 million is required.

However, if the 49-year extension is requested after six months, the required payment doubles to USD 10 million. Additionally, the amendment introduces options for shorter lease extensions, requiring USD 2.5 million for 20 years and USD 3 million for 25 years. Previously, the Tourism Act stipulated an annual extension fee of USD 100,000, payable within six months. If the payment deadline was exceeded, the fee increased to USD 200,000 per year.

The revised structure provides clearer financial terms while ensuring timely contributions from resort operators.