CM says state discussing with Putrajaya on distribution of revenue accrued from tourism tax

The state government is still negotiating with Putrajaya on the methodology of disbursing the revenue from tourism tax collection.

Chief Minister Datuk Amar Abang Johari Tun Openg said a lot more has to be deliberated as the negotiation is still underway.

“We have negotiated. And this negotiation is on-going. I stress that the disbursement of revenue from tourism tax collection should be among three regions namely Sabah, Sarawak and Peninsular Malaysia. And then all funds are to be channelled directly to the state government instead of through federal agencies. And a lot more matters we need to discuss further.

“Our tourism industry is still at a growing stage, and the (tourism) tax should not burden our people. They have agreed that those staying at three-star hotels and below to be exempted for Malaysians, meaning they don’t need to pay for the tax,” he said when met by reporters at his Hari Raya Aidilfitri open house at the Borneo Convention Centre Kuching (BCCK) here on Sunday.

Abang Johari said Sarawak had to go all-out to defend its rights while the negotiation is on-going. Asked if there is any initiative to tackle issues pertaining to ‘illegal hotels’, he said such matter “is a different issue” from that of the tourism tax. He said the state government would look into the matter but he reiterated that the issue “has nothing to do with the tourism tax”.

To another question, he said “we were talking about the residual of power, so that is the compromise, that they (Putrajaya) have to disburse (the revenue from tourism tax collection) based on region.

He went on to explain: “Because you must remember, tax is under federal, tourism is under us. You see, but tax is in finance.”

Asked whether Sarawak’s Local Government and Housing Ministry also imposed tax on hotels, he replied: “Under the Federal Constitution, imposing of tax is a federal matter.”

“What the Local Government (and Housing Ministry) can do is only fee. For Penang, they charge fee but not tax. But the federal government has a right on finance. Because tax is in finance. So that is a conflict.” Asked how he was going to solve the matter, Abang Johari said: “We are discussing.”

When a reporter asked him whether the ‘tourism tax is final’, he responded: “Not final, only the methodology is not final.” The reporter further asked ‘So (on) the first of July, they can’t…?’, to which, Abang Johari said: “No, they can’t, because we have forward booking, which does not include the (tourism) tax.” He feared that the imposition of tax “may infringe the contract between our hoteliers and tourists overseas. So we have to discuss further. And we are going to have a common stand with (the) Sabah (government),” said Abang Johari.

When pressed for a date to fully enforce the tourism tax, he said: “Depending on our discussion. It’s still in negotiation so of course I can’t give you a specific date.”

Source:
courtesy of THE BORNEO POST

by Lim How Pim

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