Sarawak, which had opposed the tax, has demanded that it keeps 30% of the tax collected within the state

By IZZAT RATNA / Pic By AFIF ABD HALIM

Tourism and Culture Minister Datuk Seri Mohamed Nazri Abdul Aziz said no state will be allowed to keep more than 10% of the Tourism Tax collected within their borders, but can request additional allocations from the ministry.

Sarawak, which had opposed the tax, has demanded that it keeps 30% of the tax collected within the state, but Mohamed Nazri said this will not happen when the tax is implemented on Sept 1.

He said due to the number of lettable rooms in their jurisdictions, the states of Penang, Selangor, Pahang and Kuala Lumpur will collect the highest revenue from the bed tax, but other states may present their case for more allocation from the ministry to promote tourism.

However, Mohamed Nazri said he would meet with representatives of states that say they need more allocation from the tourism tax to see if that can be justified.

He said the mechanisms are in place to collect the tax as scheduled on Sept 1 and that the ministry expects to collect about RM200 million a year.

Discussions about allocation for tourism promotion from the tax should not have been discussed publicly.

“(Their demands) should have been properly communicated to the ministry in order for me to decide and give each state what is deserved,” he said.

Recently, Sarawak Tourism, Arts, Culture, Youth and Sports Minister Datuk Abdul Karim Rahman Hamzah said the total tax collected must be shared equally by the three regions (Sabah, Sarawak and Peninsular Malaysia).

Mohamed Nazri said the equation would not be fair as Sabah and Sarawak have a combined 16% of the total lettable rooms in Malaysia compared to 84% in Peninsular Malaysia and the tax will be implemented as scheduled after the Customs Department has finalised its collection mechanism.

He said the ministry estimates that it will raise between RM20 million and RM30 million from the tax in 2017.

“It is normal for any country to enforce this form of tax. For example, in Myanmar, locals and foreigners are charged different room rates depending on the type of accommodation premises they occupy,” he said.

“The fees imposed are only for hotel visitors, particularly foreign tourists. Therefore, I do not understand why hotel associations are against this move as this is similar to the 10% fee hotel operators charge their customers as a recovery method for their business expenses,” he said.

Hotel operators complained that the tax was unfair and would create an uneven playing field because accommodation providers who are not registered with the ministry would escape the tax under the current situation.