Kota Kinabalu: Malaysian Tourism Federation (MTF) President Datuk Tan Kok Liang (pic) urged the Government to reinstate the sales tax exemption for tourism vehicles.
He said this is important for the industry’s recovery and preparedness for Visit Malaysia Year (VMY) 2026, which aims to attract 35 million tourists.
“The sales tax exemption was previously in effect until December 2024, designed to ease the financial strain on tourism operators during the Covid-19 pandemic.
“However, MTF contends that the industry’s recovery has been slower than anticipated, leaving many operators unable to fully benefit from the initial exemption,” he added.
Tan said the recent expiration of the exemption placed a significant financial burden on operators at a critical juncture.
He stressed that Malaysia’s tourism vehicle fleet is ageing and upgrading to modern, safe and comfortable buses is paramount to maintaining service quality and attracting tourists.
“The added cost of a 10pc sales tax — between RM70,000 and RM100,000 per bus — presents a major obstacle to this necessary fleet renewal...many operators are now unable to afford upgrades, hindering their ability to meet the anticipated increase in tourist demand for VMY 2026.”
Considering the six-nine month time for new bus delivery, the MTF is requesting a six-month extension of the sales tax exemption until July 2025.
“This extension will provide the necessary time for operators to place orders and alleviate the immediate financial pressure,” he said.
Tan said the tourism industry is still recovering and cash flow remains a concern. “Reinstating the sales tax exemption will provide much-needed cost relief, allowing operators to invest in new vehicles and improve transportation services.”
The MTF emphasised that it is not merely about financial relief; it’s about ensuring Malaysia’s tourism infrastructure is ready for the anticipated surge in visitors.
