Hoteliers want tax relief, cut in EPF payments after massive cancellations

Tourist arrivals have dropped following the coronavirus outbreak.

PETALING JAYA: Hoteliers are asking Putrajaya for help to stimulate the industry following reports that 95,000 hotel bookings have been cancelled due to the coronavirus outbreak.

Among others, they asked the government to use their venues for events, temporarily cut tourism tax, reduce EPF contributions, and give discounts on water and power bills.

Yap Lip Seng, chief executive officer of the Malaysian Association of Hotels, urged the finance ministry to implement the suggestions without further delay and to include them in the stimulus package.

He said the existing tourism tax of RM10 per room per night should be reduced to RM1 per room per night to encourage foreign tourists to visit the country, adding that this should be in place till the end of the year.

“It will not only lessen the burden of inbound tourists, particularly budget travellers, but also project Malaysia as a tourist-friendly destination,” he told FMT.

Yap said Putrajaya should also encourage domestic tourism by introducing a personal income tax relief of up to RM1,000 per individual for local travels.

He said travellers could provide evidence in the form of a tax invoice from hotels registered with the ministry of tourism, arts and culture.

The association is also appealing to the finance ministry to review and ease government procurement procedures to enable events, meetings and functions to be held at registered hotels.

“There is a need to remove restrictions and to encourage ministries, departments, agencies and GLCs to choose hotel venues for their events and functions,” Yap said.

He said there was also a need for the government to temporarily exempt the service tax for hotels up to the end of the year and give a discount on the utility bills.

“Hotels are burdened with high utility commitment due to our 24-hour operations and are in dire need of assistance.”

Yap proposed for a 10% discount to be given on water bills for hotels and a 15% discount on electricity bills for six months from February.

“We are further asking for a temporary suspension of the employers’ contribution to EPF for three months in view of the cash flow constraints caused by the current situation and the high number of employees in hotels,” he said.

The hoteliers are further asking for a temporary exemption on the minimum wage requirement for three months.

They also want a six-month exemption on contributions to the Human Resources Development Fund (HRDF) to ease the cash flow.

The Malaysian Association of Tour and Travel Agents (Matta) today confirmed that 95,000 hotel bookings had been cancelled due to the coronavirus outbreak and the travel ban imposed by China on its citizens.

The cancelled bookings were from Jan 22 to Feb 29.

The highest number of cancellations is for rooms in Sabah (29,874), followed by Kuala Lumpur (26,776) and Selangor (20,373), amounting to RM28 million of the RM40 million loss in revenue. - FMT