Tourism tax just to fill up govt coffers, says PKR

Wong-ChenPETALING JAYA: PKR lawmaker Wong Chen said that the tourism tax is more likely to backfire on the tourism industry, as its implementation is to merely enhance the government’s revenue.

He said the tourism tax was just another measure by the government to earn some much-needed revenue due to the cash crunch caused by its inability to eradicate wastage and corruption.

“I expect the hotel industry to be hit by a business slowdown for six months to a year, before normalising.

“Tourists are now more likely to use Airbnb, which is not subject to the tax as it is not regulated by the government,” the Kelana Jaya MP told FMT.

He added that in the long run the impact will not be great if the tax rate remains, but if the rate keeps going up every year then there will be significant negative impact.

Asked about the Sarawak government’s decision to withdraw its representative from the Malaysian Tourism Board as announced today, Wong Chen said that the problem is with Tourism and Culture Minister Mohamed Nazri Aziz failing to fully engage all stakeholders before pushing through the legislation.

“It is also an indication of the Sarawak government’s willingness to flex its muscle for greater autonomy and decision-making,” he said.

The Sarawak chief minister’s office today stated it was withdrawing from the federal-based Malaysian Tourism Board because it was a duplication of the role and functions of the Sarawak Tourism Promotion Board.

Last year, opposition lawmakers had criticised a proposal by the tourism and culture ministry to introduce a tourism services fee (TSF), saying the government should focus on reducing wastage and corruption first.

Wong Chen had also claimed that Putrajaya has shown that it was unable to reduce budgetary wastages and corruption despite it being highlighted consistently in the Auditor-General’s reports.

Nazri had said last week that the tourism tax will be effective from July 1, with hotels having to charge guests the additional amount, based on the quality of the hotel, on a per room, per night basis. The minimum tax amount imposed is RM2.50 for unrated and budget hotels while the maximum is RM20 for hotels rated five-star or higher.

In debating the Tourism Tax Bill before it was passed by the Dewan Rakyat on April 6, Nazri said that the revenue forecast from the tourism tax would be RM654.62 million if there was a 60% overall occupancy rate of the 11 million “room nights” in the country.

Ivy Chong contributed to this article