Malaysians exempted from tourism tax, foreigners pay RM10 flat rate

26 Juillet, 2017, 15:40 | Author: Claudine Rigal
  • Putrajaya backs down on tourism tax

Malaysians are exempted from paying Tourism Tax, which is expected to be implemented on Aug 1, Datuk Seri Nazri Abdul Aziz told parliament today.

Nazri was answering a question by Anthony Loke (DAP-Seremban) to the tourism ministry on the latest status of the tourism tax.

Nazri said today the Attorney-General Chambers and the Royal Customs Department are in the final stage of preparing the last technical details of the tax collection system.

"We will impose a RM10 flat rate from five-star to zero-star hotels for foreign tourists, and Malaysians will be exempted from the tax across all classifications of hotels", he said in Parliament on Wednesday.

The tax was criticised by the Sarawak and Sabah state governments, while hotel industry players questioned the rationale for the implementation and highlighted the impact it would have on domestic tourism. "The Prime Minister will make the announcement soon", he said.

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He reiterated tourism tax was timely, as the country lacked overseas funding in aggressive tourism promotion and marketing, unlike Indonesia which spent US$300 million to attract tourists in global fairs.

Malaysia spent an average of RM316 million between 2010 and 2015, and a year ago, the budget dropped to RM150 million, Nazri said, alluding the reduced budget to oil price fall and increased overseas tourism promotion cost. "In fact, the hotel room rates in Malaysia are lower than in neighbouring countries", he said. He expects this number to go up as more businesses register with the ministry. "This would be sustainable income for the country", he added.

On April 6, the Tourism Tax Bill 2017 was passed by the Dewan Rakyat.

Previously, he had reportedly stated that only domestic tourists staying at four-star accommodation premises and above would have to pay tourism tax, while no such tax would be imposed for those of three-star and below.

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