Malaysians Are Officially Exempted From Paying The Tourism Tax

The tourism tax is expected to come into effect on 1 August 2017.

Cover image via Courtyard @ Heeren

Tourism and Culture Minister Datuk Seri Nazri Aziz informed that Malaysians are exempted from paying the tourism tax

Tourism and Culture Minister Datuk Seri Nazri Aziz

Image via Malay Mail Online/Yusof Mat Isa

"We will impose a RM10 flat rate from five-star to zero-star hotels for foreign tourists, and Malaysians will be exempted from the tax across all classifications of hotels," said Nazri, in a report by The Star today, 26 July.

Nazri made this statement when responding to a question from DAP Seremban MP Anthony Loke on whether the government plans to standardise the tourism tax and if the locals will still have to pay it.

He also reportedly mentioned that it is now up to Prime Minister Datuk Seri Najib Razak on when the tourism tax will be officially implemented.

Just yesterday, Selangor rejected the controversial tourism tax

Selangor state executive councilor for Tourism, Environment, Green Technology and Consumer Affairs, Elizabeth Wong

Image via Yusof Mat Isa/Malay Mail Online

Selangor state executive councilor for Tourism, Environment, Green Technology and Consumer Affairs, Elizabeth Wong, said that the implementation of the tax is untimely and unsuitable when speaking at the state legislative assembly yesterday, 25 July, as reported by Malaysiakini.

"The introduction of the tax risks slowing the economy and revenue, especially for the hotel and hospitality industry."

Mabul Water Bungalows, Sabah.

Image via Daily Mail UK

"It would result in increased costs for vacations, including accommodations, tour packages, and transport.

"It would also impact hotel room rates resulting in tourism arrivals to Selangor to be affected," opined Wong, when responding to question from Ng Tien Chee (Balakong DAP), as reported by the English daily.

The DAP Balakong assemblyman had asked whether the government would be implementing the tourism tax and if it would bring positive impacts to Selangor during the state legislative assembly.

Wong told the assembly that the Customs Department has yet to give her a formal notification on the implementation of the tourism tax

She also mentioned that she has made a proposal for the federal government to look into conducting a detailed study on the effects of the tourism tax, especially to the tourism industry.

"A proper system needs to be formulated... it is implemented hurriedly, it would not be successful," added Wong.

The tourism tax was passed in the parliament after a 20-hour long sitting on 6 April. It is basically an additional charge that was supposed to be imposed on customers staying at hotels and Airbnbs with six or more rooms.

The tourism ministry previously said that the tax rates will vary according to the rating of the hotels or Airbnbs customers stay at. Here are the old rates according to the Royal Malaysian Customs:

1. Five star - RM20 per room/night
2. Four star - RM10 per room/night
3. One to three stars - RM5 per room/night
4. One to three orchids - RM2.50 per room/night
5. Unrated - RM2.50 per room/night

The orchard rating system was introduced by the Tourism and Culture Ministry for budgets accommodation premises that do not meet the requirements of the Star Classification Scheme.

The tourism tax is in addition to the existing 10% service charge and 6% GST on room rates.

Tourism and Culture Minister Datuk Seri Nazri Aziz informed that the tourism tax will come into effect on 1 August despite heavy criticisms from Sabah and Sarawak.

Both states have already objected the proposal, and the Sarawak government withdrew its representative from the Malaysia Tourism Board.

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