The Malaysian government passed a Tourism Tax Bill in a mammoth session ending Thursday morning, which analysts say is likely to weigh on the country’s hotel industry and the operator of the only integrated resort, Genting Malaysia.
The tax for non-rated hotels will reportedly be set at RM2.50 (S$0.80), while the tax for two-star, three-star, four-star and five-star hotels were set at RM5, RM10, RM15 and RM20, respectively.
The government could collect about 654.2 million ringgit based on 60 percent occupancy rate, Tourism Minister Nazri Abdul Aziz was reported as saying by state news agency Bernama. If occupancy rate rises to 80 percent, the tax revenue could swell to 872.82 million ringgit, Nazri said.
The new tax is designed to help boost government revenue, which has fallen following a slump in oil prices. However, it comes hard on the heels of a new Goods and Services Tax, which came into force in April 2015 and which has also hit consumer spending.
The nation’s hotel industry has criticized the tax, saying it will deter visitation.