No committed timeline tourism tax, says Nazri

by P PREM KUMAR

The tourism tax, which hotel guests were supposed to pay from July 1, looks no closer to being implemented by Aug 1.

The tax was deferred after hotel operators and the states of Sabah and Sarawak opposed the move. It was thought to have been postponed to Aug 1, but now the collecting agency for the tax has said that their systems are not ready either.

It is understood that the Royal Malaysian Customs Department is still facing teething problems for collection of the tax — paid when hotel guests check out — which would not be fixed by September at least.

“Customs is not ready yet to implement it nationwide at one go. There are some teething issues.

“These teething issues can cause disruptions in effective collection. So, it must be addressed first,” a government official, who did not want to be named, said.

Earlier, Tourism and Culture Minister Datuk Seri Mohamed Nazri Abdul Aziz said the government will not commit to a timeline of tourism tax implementation.

He said the new tourism tax will only be implemented when Customs is ready to collect the taxes.

“If they are ready by Aug 1, then it will be implemented by then. If not, it could be Sept 1, Oct 1, Nov 1, Dec 1 and so on,” he said.

Mohamed Nazri also said the tax would be implemented nationwide, including in Sabah and Sarawak, as the tax was enacted as a federal law earlier this year.

The minister said he had initially announced that the tax would be implemented in July, as per the discussions during Cabinet meetings.

“But now, the date will be announced when Customs says it is ready to collect the tax,” he said.

He also asked hotel operators, tour agencies and others who are unclear about the implementation of the tax to personally contact the ministry or meet Mohamed Nazri himself at his office at the Malaysian Tourism Centre in Jalan Ampang.

“Come and see me if you are still unclear about the tourism tax. We are trying hard to talk to as many people that we can, but if still there are people who don’t understand, my doors are always open,” he said.

Many have questioned the need to impose the tourism tax and Mohamed Nazri said some are also asking if the ministry lacks funds.

“We had previously been receiving RM200 million for promotion purposes from the Treasury. In 2014, we had more money because it was declared ‘Visit Malaysia Year’.

“However, since then, we have only been getting RM110 million and we have to continue advertising on billboards and exhibitions overseas, or else the space will be taken by other countries,” said Mohamed Nazri.

Under the tourism tax, tourists will be charged RM2.50 per room per night for non-rated hotels, RM5 for two-star hotels, RM10 for three-star hotels, RM15 for four-star hotels and RM20 for five-star hotels. Initially, the tax was to be imposed upon both domestic and foreign tourists.

Following outcry from various industry players on the impact such charges would have on domestic tourism, it was then announced that locals staying at hotels rated three stars and below will be exempted from the tax.

During the Parliament sitting in April, Mohamed Nazri had said the government will raise RM654.62 million from the tax with a 60% occupancy rate from the 11 million hotel rooms in the country.

However, industry experts had said the occupancy rate for most local hotels has been between 35% and 40% in recent years.