Gov’t urged to scrap tourism tax to boost arrivals

Scrapping the tourism tax and harmonising wages within the industry were among proposals raised to the Council of Eminent Persons today, according to an industry player.

Malaysian Association of Hotels president Cheah Swee Hee told reporters that removing the current flat fee of RM10 per room per night for foreign tourists would be the most attractive option to boost arrivals.

"The best (option) is to abolish. That would be most attractive to tourists.

"But then, of course, whatever is said and done we would have to discuss it," he said, adding that any solution would have to be fair to all industry stakeholders.

"At the moment we have a flat rate, they are not actually encouraging long stay because of the daily rate.

"So we are finding a solution to that.

The tourism tax was introduced by former tourism and culture minister Nazri Abdul Aziz in July last year.

It was officially enforced after several revisions on Sept 1, with Nazri saying at the time that it would net Malaysia RM210 million in revenue annually.

'Harmonise laws before wages'

According to Cheah, he also raised the Putrajaya’s proposal to raise the minimum wage to RM1,500 to the council.

Before any such move, he noted, it should “harmonise” related laws, such as the Employees' Social Security Act 1969 and the Employees Provident Fund Act 1991 – though not specifying which provisions he was referring to.

"Some of the workers in the hotel sector may appear to earn very little.

"But in actual fact the service charge (they receive) is very high," he pointed out.

Othe matters raised with the council, Cheah explained, included unlicensed hotels and Airbnb residences, as well the potential impact of the GST being replaced by the sales and service tax (SST). -Mkini

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