Scrap ‘misplaced’ push for luxury tax, say tourism groups

 

A tax on luxury goods would make Malaysian prices higher than the standard global prices, say retail associations. (Freepik pic)

PETALING JAYA: Several retail and tourism associations have added to growing calls for the proposed Luxury Tax to be scrapped, adding that the push for such a system was “misplaced”.

These associations say that it was difficult to define luxury goods and it would be simplistic to include established brands.

Established brands are sold at globally standardised prices.

“Any added tax will immediately make local prices more expensive compared to the standardised global pricing regime,” they said in a joint statement.

Among the associations are the Malaysia Retailers Association, the Malaysia Retail Chain Association, Malaysian Association of Theme Parks and Family Attractions and the BBKLCC Tourism Association Kuala Lumpur.

The associations also cite the negative response to the UK’s decision to withdraw Value-Added Tax rebates. The head of the Burberry apparel company said the decision had affected travel, hotels, airlines and airports and made Britain the “least attractive” shopping destination in Europe.

The associations said: “Let us not go down this unsustainable path.”

Putrajaya’s plans for a luxury tax also met resistance from the Small and Medium Enterprises Association which last week said the plans should be abandoned until the economy recovers.

Tourism zones

The 10 associations also called for certain venues in Kuala Lumpur and other cities to be declared as International and Tourism Zones. Such an initiative would balance the sensitivities of local residents and the expectations of tourists, they said, calling for earlier attempts at such zones, such as Bukit Bintang in Kuala Lumpur, to be revived and expanded. - FMT