Tourism tax

Come 1 July 2017 Malaysians and foreign tourists alike will have to pay additional funds for their respective hotel rooms depending on the accommodation of choice.

The controversial ‘Tourism Tax’ will start from RM2.50 per room per night at non-rated accommodations including budget hotels, RM 5 for one to three star hotels, RM10 for four star hotels and RM20 for five-star hotels.

When Tourism and Culture Minister Datuk Seri Mohamed Nazri Abdul Aziz tabled the Tourism Tax Bill 2017 in the last session of parliament he justified the bill by stating that the levy would be able to bring in an income of about RM654.62 million.

Assuming there was a 60 per cent occupancy rate at over 11 million hotel rooms in the country. Needless to say the bill was approved by majority vote.

Since then there have been plenty of confusion and anger over the levy’s date of implementation and complaints from many quarters, including hoteliers and its industry associations over the additional costs to be imposed on travellers.

Those in the hospitality industry are understandably upset contending that it is presently not a conducive time to introduce such taxation as it would make Malaysia less competitive compared to neighbouring countries.

Meanwhile hoteliers in Penang, Melaka and Langkawi had also underscored the state tourism tax that presently exists. Disagreement over the tourism tax escalated with Sarawak immediately removing its representative from the Malaysian Tourism Board.

Perhaps in hindsight the Ministry of Tourism and Culture should have held a proper discussion with the relevant parties affected by the Tourism Tax Bill prior to it being introduced in parliament.

The impression is that those in the hospitality industry and state representatives were caught off guard. If anything it would seem that the federal government has a one-track mind. Thus the overall process was not inclusive and hastily executed.

But most importantly by engaging everyone the government could have avoided all the unnecessary commotion these past few weeks.

It would also indicate to the people that the government is listening to those concerned and not merely meting out directives.


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