Thursday, June 8, 2017

Will we see any tourism tax money, asks Sarawak minister

Desmond Davidson

Will we see any tourism tax money, asks Sarawak minister
Tourism is an important money spinner in Sarawak and the state says Putrajaya should not simply collect taxes from its tourists. – AFP pic, June 8, 2017.
SARAWAK is worried that it will not see any of the money collected from the new tourism tax bill, said a state minister. 

Minister of Tourism, Arts, Culture, Youth and Sports Abdul Karim Rahman Hamzah told The Malaysian Insight that he is concerned whether proceeds from the tax will be funnelled back to the state.

“They (federal Tourism Ministry) can’t just come, collect taxes from our tourism and take all the money back to Kuala Lumpur.

“Right now, there’s no guarantee how much money we will get… if we are getting any at all.”

“My view is that if the tax collected in Sarawak, then all the money should go to Sarawak.”

Karim said the new tourism tax is another example of Putrajaya bulldozing a policy, which has a profound impact on Sarawak.

He said that Putrajaya should have consulted Sarawak although tourism is not on its state list. 

The Ninth Schedule of the Federal Constitution spells out the different powers federal and state governments have. Tourism falls under the federal list. 

He said even though tax collection is a federal matter, tourism in Sarawak and Sabah is a state matter and hence Putrajaya should not be collecting taxes on their behalf.

Putrajaya’s failure to consult with Sarawak, Karim said, is also against the spirit of the 1963 Malaysian Agreement.

Karim said when Sarawak’s forefathers crafted the Malaysia Agreement, tourism was not discussed and, therefore, not placed on the state list.

He said when such matters are not stated, they should fall into the concurrent list and the understanding in 1963 was that the matter would have to be discussed between the state and federal governments before it is carried out.

“I'm sure no one in 1963 had thought how important tourism would be in the future.”

Karim said while he is against the tax, the state cabinet has yet to take a stand on it.

“It has not been discussed in the cabinet just yet.”

The tax will see tourists paying a levy to operators of most types of accommodation. 

It will be imposed on both Malaysians and foreigners, regardless of whether they are on a leisure or business trip.

The tax will be in addition to the goods and services tax (GST) and service charge. The rates are RM20 per room per night in five-star premises; four-star (RM10); three to two stars (RM5); and orchid and other non-rated accommodation premises (RM2.50). – June 8, 2017.

~ The Malaysian Insight

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