Tourism bodies hail move to limit AirBnBs
Published on: Wednesday, April 10, 2019
By: Nikko Fabian

KOTA KINABALU: Three major tourism associations in Malaysia have welcomed the proposal by Malaysia Productivity Corporation (MPC) to limit the stays in AirBnB.

If accepted by the government, Malaysian Association of Hotels (MAH), Malaysian Budget Hotel Association (MyBHA) and Malaysian Association of Tour and Travel Agents (Matta) said the MPC proposal, along with a revision of existing laws to regulate STA will be implemented next year.

An affirmative decision would also mean that short-term accommodations (STA) in Malaysia will soon only be allowed to operate for a maximum of between 90 and 180 days in a year.

MPC, a statutory body under the International Trade and Industry Ministry, has held discussions with key industry stakeholders since July last year.

It will submit a regulatory framework to the government by the end of this month.

The associations concerned are in the opinion that the home-sharing industry is a double-edge sword apart from being disruptive to local residents and authorities.

Their heads Lip Seng Yap, P.K. Leong, and Datuk Tan Kok Liang respectively said an amendment to current laws is also vital to prevent STA operators from taking advantage of loopholes in existing regulations.

“Encouraging STA (short-term accommodation) operations in the name of boosting tourist arrivals will have adverse effects in the tourist sector in the long term,” Tan told Daily Express.

He said tourist arrivals in the next few years is not expected to be on a double digit increase (percentage wise) and hotels are recording somewhat lower occupancy due to loss in market share to cost-conscious and budget travellers.

Calling it a “long overdue issue, Matta said there has been much leakage in taxation when it comes to STAs.

Tan said STA platforms make use of borderless digital commerce to circumvent the country’s taxation policies resulting in a loss of much-needed income to the nation.

Pessimistic about the contribution of STA towards the tourism economy, Tan noted that home-sharing is usually catered towards cost-conscious travellers.

If the aforementioned scenario persists, Tan said Malaysia may have difficulty attracting hotel investments.

“Once the budget and hotel industry loses its shine, it will be difficult to attract high-end tourists and MICE groups to Malaysia – tourism is not just about headcount, it’s also about yield,” he stressed.

Although recognising that STA could be an alternative source of accommodations during Visit Malaysia 2020, Tan said it must be subjected to all taxes that are imposed on licensed hotels and accommodations.”

“Platforms like AirBnB serve their purpose, especially during peak seasons or when there is a lack of rooms during major events in the town or city.

“It enables genuine homeowners to make a side income,” he said.

Tan added that stringent regulation would protect tourists as well as the local community.

He said regulations of the home-sharing industry will ensure that our hospitality sector meets tourist expectations, thus ensuring a quality stay in our country,” he emphasised.

The Matta President also echoed similar sentiment of Yap that STA or home-sharing in Malaysia at this point is as good as trying our luck.

Both Tan and Yap agreed that there is no independent check and balance apart from no independent review or feedback system in existence.

“Where would a guest with a problem (lodge an official) complaint to? Nowhere,” they stressed adding that tourists deserve to be protected.

Concerted calls have been made repeatedly to put the home-sharing industry under scrutiny.

Thus, there is some form of relief that a proposal from the MPC to the Government is already underway.

Tan and Yap also said among the problems that city governments and state regulations foresee with AirBnBs are the potential to upend landlord relations, potential influx of travellers who who will transform quiet residential neighbourhoods into revolving hotel districts.

“There are also concerns of a current lack of oversight and accountability over AirBnB-related tax collection and adherence to zoning by-laws,” the President and Chief Executive Officer respectively said.

Tan said the 13 cities who recently enacted strict Airbnb regulations worldwide are Los Angeles, California; Amsterdam, the Netherlands; New York City; Mallorca,Spain; Charleston,South Carolina; Paris, France; San Francisco, Carolina; Barcelona,Spain; Santa Monica, California; Japan; New Orleans, Louisiana; Reykjavik, Iceland; and Las Vegas, Nevada.

Meanwhile, P.K. Leong said the growth of STA will be detrimental towards budget hotels in the country. He highlighted the fact that tourists who stay at STA don’t pay the tourism tax.

“We can’t stop people from earning an income, but it has to be fair to all. They must be subjected to all taxes as budget hotels too,” he said.

On a claim from Sabah Association of Tour and Travel Agent (Satta) President Dato Seri William Liaw that short-term accommodation operators can co-exist with high-end hotels including other budget accommodation providers, Yap and P.K. Leong disputed the claim.

Yap and P.K. Leong also rebut Satta’s disclosure that hotel occupancy rate was never affected by the entry of STA operators.


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