Defer Tourism Tax implementation — hoteliers

KOTA KINABALU: The Sabah Hotel Association (SHA) has again reiterated its call to the Federal Government to defer the implementation of the Tourism Tax 2017.

The deferment is necessary to avoid any legal implication that will affect the hotel industry, its president, Christopher Chan pointed out.

Chan said the hotels needed time to change their accounting system and train its personnel on the new tax system.

“Whatever the mechanism or rate is, the implementation must be deferred and we are insisting that it can only happen by the April 1 next year to avoid any legal implication that will affect the hotel industry,” he said.

Tourism and Culture Minister Datuk Seri Nazri Abdul Aziz announced yesterday that Malaysians would be exempted from the tourism tax, regardless of whether they stay at luxury hotels or budget inns.

Nazri said foreigners would have to pay a flat rate of RM10 under the tax and for every RM10 collected, RM1 would be returned to the respective state governments to fund their tourism promotion activities.

The tax will be enforced by the Customs Department and is expected to come into effect on August 1.

Chan also pointed out that what Nazri announced was totally different from the original tax structure presented to Parliament

“If this is the case, an amendment to the Act must be re-tabled in Parliament,” he opined.

According to Chan, if the implementation was to take effect on August 1, then it is advisable for the government to impose the tax on all foreigners irrespective whether they stayed in a hotel or not when in Malaysia.

The tax can be collected at all exits from the country like the check-in counter of the airlines at the airport and the immigration counters at land exits like the causeway.

This means that the tax is collected based on the headcount of visitors to Malaysia and to prevent any loopholes to the legislation, he stressed.

SHA, Chan added, also hoped that there would be further changes made to the mechanism of tax as it was confusing the industry players.

It would also be difficult to work with the Customs Department for eventual implementation not to mention the extra cost to the hoteliers when they have to keep reprogramming their accounting system to keep up with the constant change of the tax mechanism, he stressed.