Budget 2023: Discounts, vouchers and rebates to boost domestic tourism

Finance Minister, Tengku Datuk Seri Zafrul Tengku Abdul Aziz, said that the incentives are in the form of discounts, vouchers and rebates for lodgings, tourism packages, handicrafts and artwork up to RM100.

A total of RM200 million has been allocated to encourage, promote and do marketing to strengthen the recovery of the tourism sector, since the government has targeted to receive more than 15 million foreign tourists, with an income value of RM47.6 billion, next year, he said when tabling the Supply Bill 2023 at the Dewan Rakyat here today.

"The government, among others, will focus on high-value tourists in niche market segments like ecotourism, golf and scuba sports, and international conventions.

"A total of RM90 million has been allocated, in the form of matching grants, for a programme such as the Galakan Melancong Malaysia (Gamelan) which involves promotional campaigns and marketing with the industry. Matching grants are also provided for organising tourism programmes, including international sports events," he said.

He said that the government, together with Malaysia Airport Holdings Berhad and international airlines, will work on new international direct flight routes such as from West Asia and the Middle East to Malaysia, including to Kota Kinabalu International Airport and Penang International Airport.

In addition, Tengku Zafrul said that RM10 million will be provided through a joint venture with a network of ecotourism operators next year, to upgrade ecotourism attractions in Gua Kelam, Perlis; pioneer sustainable solid waste management efforts in Perhentian Island, Terengganu and to intensify activities at the Sultan Ahmad Shah Perak Jubilee Agricultural Park in Kuantan, Pahang.

To further encourage the tourism sector to prioritise local handicrafts, he said that the government proposed a special tax deduction for hotels that have local handicraft products with a purchase cost of up to RM500,000.

In an effort to help tourism operators, the government plans to implement four initiatives, namely Bank Negara Malaysia tourism financing, worth RM500 million, including increasing the maximum funding limit from RM300,000 to RM500,000

"Secondly, 100 per cent tax exemption is given on statutory income for tour operators who bring at least 200 tourists a year or at least 400 domestic tourists.

Thirdly, he said that a 50 per cent duty exemption on the purchase of locally assembled completely knocked-down (CKD) tourism vehicles for the use of rental and drive and tour buses, and fourthly, the reinvestment allowance for selected hospitality and tourism projects introduced under the Income Tax Act 1967.

The Finance Minister also announced that RM10 million will be allocated to Think City for the Kuala Lumpur City Centre Regeneration initiative, to continue to transform it into a creative and cultural hub.

In order to make Malaysia a major health tourism destination, he said that the existing tax incentives for the export of palliative care services will be extended until 2025, in addition to RM20 million provided to the Malaysia Healthcare Travel Council to strengthen Malaysia's position as a preferred destination for health tourism.