No Tourism Tax for Malaysians, RM10 Flat Rate for Foreign Tourists

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Another flip-flop on tourism tax, but this time it is the best news yet for locals.

  • Malaysians fully exempted from paying tourism tax in all accommodations
  • Foreign tourists pay flat rate of RM10 per night per room in all accommodations except those with fewer than five rooms
  • Implementation expected on Aug 1

Malaysians are fully exempted from paying the tourism tax, Tourism and Culture Minister Datuk Seri Nazri Abdul Aziz told Parliament today.

The Tourism and Culture Minister said all tourists will be charged a flat rate of RM10 per night per room in all types of accommodations except for premises with fewer than five rooms.

Nazri said that the decision on exempting locals and fixing a flat rate for foreigners was made after engaging all stakeholders, including tour operators, the Royal Malaysian Customs Department and state authorities.

“With the flat rate, no complex mechanism is needed to collect the taxes.

“The flat rate will make it easier for customs to collect taxes based on the number of rooms booked at a hotel,” Nazri said.

He added that the flat fee also makes it easier for tourists to know how much they have to pay, based on the number of nights they plan to stay.

Nazri said that there was nothing left to discuss on the matter, adding that it was now up to the Prime Minister to decide when the tax would be officially implemented.

The tourism tax came under fire the moment the announcement was first posted on the customs website, with the Jul 1 commencement date. The posting was later taken down.

Under the original plan, both domestic and foreign tourists were expected to pay RM2.50 per room per night for non-rated hotels, RM5 for two-star hotels, RM10 for three-star hotels, RM15 for four-star hotels and RM20 for five-star hotels.

The tax was criticised by the Sarawak and Sabah state governments. Concerns were also raised by hotel industry players on the impact of the tax on domestic tourism.

Following this, the government said locals staying at hotels rated three stars and below will be exempted from the tax.

However today, Nazri delivered the good news that locals are fully exempted from paying the tourism tax in all accommodations.

Related report: Jun 30, Tourism Tax Will Drive Tourists to Neighbours, Sabah Says