In response to the backlash from the industry, the proposed tourism tax rate was revised prior to its implementation. According to the Minister of Tourism and Culture, Nazri Aziz, the revised tourism tax will see foreigners staying at paid accommodations being charged a flat rate of RM10 per night, while Malaysians will be exempted from it completely. When the tourism tax was first announced, a rate between RM2 and RM20 per night, depending on the type of accommodation, was proposed, applicable to both the local and foreign population. However, strong protests, especially from the state of Sarawak, subsequently led to the revision of the tourism tax. The ministry estimates tax proceeds of RM210,956,797 a year based on an average occupancy rate of 60 percent of currently registered rooms, and the proceeds will be used to fund state-level tourism promotion activities. While initially thought to be implemented from 1st August, Mr. Nazri has reportedly said that the date of implementation is now contingent on the prime minister’s decision.
HVS APAC HOSPITALITY NEWSLETTER.