Kota Kinabalu: Sabah has rejected plans by Tourism and Culture Minister Datuk Seri Nazri Aziz to introduce a hospitality levy, with State Tourism, Culture and Environment Minister Datuk Seri Masidi Manjun (pic) saying any form of levy should go to the State and not to the Federal Government. Masidi said he understood the standpoint of the Government to generate a stream of income during tough conditions, but that the cost and benefit analysis should also be considered before proposing such a levy.
"Tourism is viewed as the saviour of the country's economy when times are tough.
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"The revenues are huge at present … but many players are not making a big profit," he said.
Masidi revealed this following the State Cabinet's deliberation on the matter on Wednesday, saying that Nazri's proposal was worth considering, but not at the present time.
"For that matter, the State Cabinet feels if there is money that needs to be charged or levied, it should go back to the State so that Sabah has the funds for its own promotions.
"There is nothing wrong in channeling the money to Sabah Tourism Board as they can do a better job (than Tourism Malaysia) in promoting the State in other countries.
"My point is we know how to sell Sabah better than anyone else because this is our State and we know exactly how to sell it," said Masidi, adding that the Government spent a huge sum on tourism and it was still not enough.
He pointed out that many Sabahans risked losing their jobs when the tourism industry is hit with tough times and this would worsen if the Government decides to impose a levy.
Under the proposal, a fee of RM5-RM30 would be levied per day depending on the type of accommodation.
Hence, a five-star hotel would charge RM30 per day or RM90 more for a three-night stay.
On Wednesday, Nazri in a rebuttal to Masidi's earlier statements on the hospitality levy said the Federal Government is in the process of discussing the matter with stakeholders, and that if a decision to impose the tax is made, it is well within Putrajaya's rights to do so.
"Even if we decide later on imposing the levy, it's not taking away the state's power, not even devolution because we are not doing this outside the constitutional requirement.
"Even if we decide to impose the levy on Sabah hotels, we can do it, tourism falls under federal (jurisdiction)," Nazri said in response to an earlier comment from Masidi who indicated it was likely Sabah would not adopt the new tax.
Nazri's hospitality levy suggestion drew negative criticism from many quarters here including Assistant Tourism, Culture and Environment Minister Datuk Pang Yuk Ming who said it was unbecoming of the Minister to state that tourism funding to Sabah may be stopped if the State opts out of the proposal.
He said the Federal Ministry would be falling back on the Malaysia Tourism Promotion Board Act 1992 to allow the charge of fees or any form of charges to execute its function and authority.
