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More on tourism tax

  • The tax collected must be put to proper use.

Sin Chew Daily

With the government declaring that Malaysians are exempted from tourism tax, many finally manage to draw a sigh of relief as they do not have fork out extra money to stay in a local hotel either for holiday or business.

After all the controversies, the latest decision by the government is that Malaysian citizens will be exempted from tourism tax while foreign visitors have to pay a flat rate of RM10 per night if they stay in a hotel irrespective of the star rating.

All homestays offering fewer than five guest rooms will also be exempted.

Compared to earlier proposals, the latest decision is without doubt more straightforward and less taxing. It was earlier said that Malaysians staying in hotels of three stars and below would not have to pay tourism tax while foreigners would be charged between RM2.50 and RM20 a night depending on the star rating.

The industry is obviously happy with the latest decision, feeling that this would help stabilize the development of the domestic travel sector, They were earlier concerned that the tourism tax would discourage Malaysians from traveling within the country as it would increase their financial burden. This is because not all Malaysians stay in a local hotel for vacation, and they have already paid GST.

The hospitality industry is of the opinion that reducing the tourism tax to a flat rate of RM10 for 4-star and 5-star hotels will minimize the impact on high-end establishments. Moreover, RM10 is not a big deal to foreign tourists.

That said, the cost of staying at a 3-star hotel or below will invariably be heavier, and the burden will become more marked for backpackers staying in budget hotels or guesthouses.

As for the actual date of implementation, the tourism ministry has said an announcement will be made very soon. However, travel-related operators feel that it will be best for the new policy to be implemented only next year, as hoteliers need time to make adjustments to their existing systems while tour operators may need more time to discuss the new fare structure with their oversea partners.

If the hotels are responsible for collecting tourism tax from guests, some may opt to stay at establishments not registered with the government so as to avert the tax.

The industry has therefore proposed that the tax be collected at points of entry such as airports, seaports and border posts since the tax collected will eventually go to the customs department anyway.

The purpose of tourism tax is to develop the country's tourist industry, enhance existing infrastructure and facilities as well as carrying out promotional events and campaigns to ensure the sustained development of the industry.

Indeed the intention is good, and the federal government has planned to return RM1 from every RM10 collected to the respective state governments for the purpose of developing the tourism industry.

It is hoped that tourism tax will eventually be used on where it is needed most.


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