MIRI: The federal government should exempt Sarawak from the Tourism Tax and offer more incentives to boost the tourism industry.
Assistant Minister of Tourism, Arts and Culture Datuk Lee Kim Shin made this call yesterday in support of the objection by Minister of Tourism, Arts, Culture, Youth and Sports Datuk Abdul Karim Rahman Hamzah
and industry players in the state.
Abdul Karim has slammed the move as unwarranted and disrespectful of Sarawak.
From Aug 1, hotel customers would be required to pay a nightly tax per room of RM20 for five-star hotels; RM10 for four-star hotels; RM5 for one to three-star hotels; and RM2.50 for one, two, and three orchid-rated hotels as well as unrated hotels.
The new tourism tax, which comes into effect after the passing of the Tourism Tax Bill in Parliament, will be in addition to the goods and services tax (GST) and service charge.
Accommodation premises with less than 10 rooms and homestays registered with the government will be exempted from collecting the tax.
Lee joined Abdul Karim in criticising the move which is being seen as an example of the federal government imposing tax laws in Sarawak without consultation which goes against the spirit of the Malaysia Agreement 1963.
Abdul Karim had earlier said that tourism was not placed in either the Federal or State List, and the understanding is
that it will be treated as being placed in the Residual List, where the matter is to be deliberated and discussed between the state and federal governments.
Lee said incentives, not taxes, should be given by the federal government to the state to support its fledgling tourism industry to be on par with the rest of the country.
“Sarawak should have been consulted in the first place as tourism here is still behind states in Peninsular Malaysia and Sabah,” he pointed out.
He also highlighted that the Tourism Tax is opposed by industry players across the board in Sarawak.
He was referring to the statement by Malaysian Association of Hotels (MAH) Sarawak Chapter president Ibrahim Nordin who had warned of hotels incurring additional costs such as reprogramming of software and credit card payment facilities, while customers would have to bear additional costs as well. Ibrahim said its members will not be complying with the request for hotels to register despite the enactment of the law.
MAH Sarawak Chapter made the decision because hoteliers in the state want their queries over the collection mechanism and unfair playing field due to unlicensed operators to be addressed first.