Tourism Tax Law – A new step by the Malaysian Parliament

Published on : Monday, April 10, 2017

Malaysian ParliamentThe Malaysian parliament successfully passed the tourism tax law on Thursday. This could bring a negative impact on the hotel operators in the country, including Genting Malaysia Bhd as confirmed by a note from the Malaysian investment bank CIMB. The effect of the new tax will be minimal said analyst Ivy Ng Lee Fang in a note on Saturday.


Ivy Ng Lee Fang believes that the tourism tax order allows the government to inflict tourism tax on hotel stay in Malaysia. The Tourism and Culture Minister will fix the tax rate as per the rules imposed in the legislation. Mohamed Nazri Abdul Aziz, Tourism and Culture Minister, said to the local media that in parliament that if the occupancy rate of 60 percent can be achieved for the 11 million, revenue from tax could reach MYR654 million (US$147.3 million).

To quote the minister, ‘With proper promotion and 80 percent occupancy rate, MYR872.8 million can be collected.’ The minister said that the tax would provide a sustainable fund for growth and future development of the tourism of Malaysia. However, the amount of tax would differ as per the media reports. Also, the star rating of the hotel plays an instrumental role in terms of tax. CIMB’s note said it was likely the respective tax rates for 2-, 3-, 4- and 5-star hotels would be set at MYR5, MYR10, MYR15 and MYR20.


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