‘New hotel tax will turn off holidaymakers’

Khoo-Boo-LimGEORGE TOWN: The federal government’s new hotel tax may deter foreign visitors from staying longer and spending more money during their holidays here, a hoteliers’ association said today.

Malaysia Association of Hotels (MAH) Penang chapter chair Khoo Boo Lim said the association had proposed that the “tourism services fee” be collected as a one-off payment only, instead of being levied per night.

FMT reported that the tax for non-rated hotels would be RM2.50, while the tax for two-star, three-star, four-star and five-star hotels would be RM5, RM10, RM15 and RM20, respectively.

The tax collected will be earmarked for tourism promotion.

The tax was announced as part of the Tourism Tax Bill 2017, which was passed early this morning in the Dewan Rakyat.

MAH president Cheah Swee Hee told theSun daily that the association would meet the tourism and culture ministry to raise their concerns over the tax.

Meanwhile, Khoo said the tax would drive holidaymakers to other alternatives such as homestays and leasing short-term accommodation with online services, such as AirBnB.

Khoo said although the new legislation would require those staying at such places to pay the tax, it would put the majority of hotels at a disadvantage.

He said the government should introduce regulations for homestays and AirBnB operators so that they could be tracked and monitored.

The hotel tax is not new in Langkawi, Penang and Malacca, as each have their own “fees” in addition to their room charges per night.

Penang introduced a “local government fee” on hotel stays in 2014.

RM3.00 is charged per room per night for four-star and five-star hotels, and RM2.00 is charged per room per night for hotels rated three stars and below, including all dormitories, budget hotels, hostels and guest houses.

Meanwhile, in Langkawi, a RM9 surcharge is imposed per night on all hotel stays.

In Malacca, a heritage tax fee of RM2 is imposed per night.

On the compound effect of the new federal hotel tax and the Penang local government fees, Khoo said there would not be much effect.

“What the local governments are collecting is only a small amount, so even reducing it won’t see much effect as compared with the proposed tourism tax.”