LABUAN, Aug 3 — The tourism tax exemption for Malaysian tourists starting August 1, 2017 would help boost the domestic tourism sector.

Major hotels, including international hotel chains, said the move showed the government’s empathy for their predicament in the wake of declining occupancy rate.

International Grand Dorsett Hotel General Manager, Susan Carlos, said the exemption was a relief as local tourists made up 70 per cent of the hotel’s guests.

“We have been holding a number of promotions to woo guests to our hotels on the island and in the other states,” she told Bernama.

She said the drop in the occupancy rate was attributed to the slowdown in the island’s oil and gas (O&G) sector.

Tourism and Culture Minister, Datuk Seri Nazri Aziz, on July 25 announced the government’s decision to exempt Malaysians from paying the tourism tax.

Nazri said a flat rate of RM10 per night and per room for all types of hotels and accommodation would be levied on foreigners.

Tiara Hotel Managing Director, Chai Tze Kee, said the exemption would encourage locals to have their vacations locally, thus helping to boost the tourism industry.

“It was a right decision as the current economic slowdown does not permit us to impose certain rulings that could impede our economic progress,” he said.

He hoped the revenue derived from the tax would be used to promote Labuan as a tourism destination.

Billion Waterfront Hotel Sales Director, Roziyati Abdullah, said the island’s badly-hit O&G sector had spearheaded the drop in occupancy rate since middle of last year.

“With dwindling expatriate arrivals to the island due to the decline in the O&G industry here, we now depend on domestic tourists to fill up our rooms,” she said.

Roziati said the exemption would help maintain the momentum of the hotel’s occupancy rate.

Meanwhile, Aifa Hotel Resident Manager Ted Teo said his guests were mostly O&G industry workers from Peninsular Malaysia.

“The exemption would certainly help us stay afloat,” he said.

Hotel owners here unanimously agreed that should the tourist tax be imposed on local travellers, they would have no choice but to pass on the costs on to their guests. — Bernama