Datuk Seri Nazri Aziz said the levy is expected to contribute RM654.62 million to the treasury and would be used to improve the tourism industry, but without elaborating. ― Picture by Choo Choy May

KUALA LUMPUR, June 10 ― The Sarawak government wants the federal government to postpone implementing the Tourism Tax from July 1, at least for the two Borneo states.

State Minister of Tourism, Arts, Culture, Youth and Sports Datuk Abdul Karim Rahman Hamzah said it was not against the new tax, but wondered at the federal government’s haste to enforce it, The Borneo Post reported on its website today.

“We want the enforcement of the Tourism Tax to be deferred. If they do not want to defer it in Semenanjung, that is up to them. But at least defer it in Sabah and Sarawak,” he was quoted telling reporters in Kuching yesterday.

He was also reported to have warned that there might be repercussions for “going against the tide”.

Abdul Karim was also reported saying tourism was placed in a residual list for matters to be discussed between the central and state governments when Malaysia was formed in 1963 and only shifted into the Ninth Schedule under the Federal Constitution to be treated as a federal matter a few years ago.

“You have to respect the Malaysia Agreement 1963. And another thing ― the state government must have some say in the matter; maybe the state government wants part of the tax collected to be returned. There is no federal allocation for the tourism sector in Sarawak this year,” he was quoted saying.

The new tax will see hotels around the country charging between RM20 and RM2.50 per night for accommodation, regardless of whether they are five-star class or unrated, and is expected to contribute RM654.62 million to the Treasury, if there was a 60 per cent occupancy rate at over 11 million hotel rooms in the country.

Federal Tourism and Culture Minister Datuk Seri Nazri Aziz said the levy is expected to contribute RM654.62 million to the treasury and would be used to improve the tourism industry, but without elaborating.

Hoteliers nationwide have panned the federal government’s push to introduce the Tourism Tax in less than a month as unfair as they would be penalised if they fail to collect the charges.

According to the hoteliers and other business groups, the tourism industry had yet to bounce back to pre-2014 levels caused by global backlash over the still missing Malaysia Airlines flight MH370.

The Sabah government had weighed in earlier on the new tax, saying the state Cabinet will be reviewing the enforcement to see if it could opt out of collecting.

In a separate report in The Borneo Times today, the Kota Kinabalu Chinese Chamber of Commerce and Industry said the Sabah government’s review remark was welcome as the Tourism Tax would place a financial strain on domestic tourists and not just foreigners who stayed in hotels for work trips.

Its president Datuk Michael Lui was reported saying the tax would be a severe blow to Sabah as tourism is its main economic driver, as well as Malaysia’s competitiveness at the regional level.

The Tourism Tax Bill 2017 was tabled and passed by a majority vote at the the last parliamentary sitting earlier this year.