Diligence pays when booking stays

Tax hike underscores need for careful planning for lodging

BOOKING hotel rooms online this year has become an exercise in due diligence to get our money’s worth.

Several friends and I began paying attention to the fine print when making hotel bookings after the government’s sales and service tax (SST) rose to 8% from 6% last month.

It is fair that the government needs to raise taxes to keep the country going, but when we taxpayers want to book accommodation for several nights, or need more than one room, the charges add up.

And even higher than the SST is the 10% service charge that many hotels include.

So if the listed booking price is RM100 a night, you will pay RM118 (SST plus hotel service charge) a night and if you need a few nights, these surcharges snowball into the size of a sumptuous meal.

To understand more, I spoke with many hotel managers in Penang.

It turns out that some hotels avoid adding the 10% service charge, or perhaps this amount is already embedded into the listed room price.

Some hotels and serviced apartments have their rates listed as “including taxes”, meaning that the SST is also inserted and there will not be extra charges piled on just before you confirm your booking and make payment online.

Some opine that listing the hotel’s price with taxes and charges added is fairer to prospective customers; why pretend that your price is so good but just before paying, another 18% is added?

If the charges and government taxes are unavoidable, why not be transparent and let customers know the end-price from the start?

Additionally, there is the amount that online travel agents (OTA) need to earn.

A few hotel general managers explained that OTA (nearly all are foreign companies) are online hotel booking platforms that buy hundreds of room nights from many hotels at favourable rates to resell.

They earn between 12% and 18% in commissions.

“We can’t do much during peak seasons, but if you come to Penang on days that are not weekends or school holidays, you might get a better price by directly booking from hotel websites,” one manager pointed out.

He explained that during offpeak times, hotels would not mind offering lower rates to fill their rooms rather than leaving them vacant.

And since they will end up paying commissions to OTA anyway, they would rather give that amount in the form of savings to guests who book with them directly.

During the Hari Raya Aidilfitri holiday season, Starmetro checked with many hotel operators in Penang and discovered that occupancy rates did not swell as hoped for.

Most hotels reported being 60% to 80% full which, by Penang standards, can be called normal.

During the last year-end holiday season, every resort in Batu Ferringhi was at 99% full for days on end.

Of course, since Aidilfitri holidays fell on Wednesday and Thursday, smack in the middle of the week, maybe working folk might not have bothered to take annual leave to “fill in the blanks” and have a holiday.

But if the rising cost of living is keeping you from making a short trip to chill out, a more careful study of surcharges and checking on hotel promotional rates directly might help you better afford the holiday you deserve.