Tourism tax: Special incentives for local travel agencies

He said the matter was brought up by Tourism and Culture Minister Datuk Seri Mohamed Nazri Abdul Aziz on Tuesday in a special meeting to discuss issues related to the tax implementation.

He said the type of incentives would be announced soon after the government had determined a suitable mechanism in granting the incentives.

"Most travel contracts between local and foreign agencies were agreed upon and signed prior to the tourism tax implementation. As such the agreed prices were not inclusive of the tax.

"Events under meetings, incentives, convention and exhibitions (MICE) tourism sector had been planned well in advance. We do not want our members to fork out extra money for the tax or pay compensation for termination of contracts," he told a press conference here today.

The Tourism Tax Bill 2017 which was passed in the last Dewan Rakyat sitting among others allowed tax rates of between RM2.50 and RM20 to be charged for overnight hotel and lodging accommodation.

When winding up the debate, Mohamed Nazri said an estimated RM654.62 million could be collected if the occupancy rate for the 11 million rooms in the country achieved 60 percent.

Meanwhile, Uzaidi said MITA fully supported the government's implementation of the Tourism Tax as the proceeds could be used to promote tourism activities or develop tourism infrastructure and facilities.

"Promotional activities play an important role in promoting tourism destinations. MITA must not be left behind while other countries are boosting their tourism marketing strategies," he said.