Budget 2023: Hoteliers lament limited allocation for struggling tourism sector

PETALING JAYA: Budget 2023 offers limited allocations for the tourism sector and will not deliver aid to the struggling hotel industry, says the Malaysian Association of Hotels (MAH).

The association said in a statement on Saturday (Feb 25), that the government’s allocation of RM250mil to promote the tourism industry is insufficient to meet the Tourism, Arts and Culture Ministry’s target.

The target is more than 16 million tourist arrivals and RM49.2bil revenue for this year.

“We feel the allocated amount is insufficient as it constitutes less than 0.6% of the expected receipts.

“Additionally, the blanket method of allocation for the tourism industry may not fully reach struggling sectors and address the industry’s needs,” it said, adding that there were no provisions to aid the recovery of the struggling hospitality industry.

MAH said that hotels in the country faced an electricity tariff hike early this year, which had led to a significant increase in operational costs.

“The sector also had to cope with higher minimum wage and lower work hours; as the hospitality sector is very labor-intensive, our industry is very vulnerable to the legislation and have been especially affected by it further stymying our recovery.

MAH proposed several measures that should be taken by the government to address the industry’s plight.

This included introducing a moratorium for the new electricity tariffs for hotels, theme parks and convention centres until the end of 2023, providing stimulus packages for hotels via a one-off financial aid or continuous added value programmes and special tax allowance or deductions involving hotel renovations and refurbishments.

Other suggestions were to expedite hotel applications for foreign workers, regulate short-term accommodations (STA) to ensure a level playing field and safety of guests and the collection of tourism tax at the country’s entry points. This is to guarantee all inbounds are taxed and not restricted to those that choose to stay at legitimate hotels.

“MAH hopes with the aid of the government, we can provide the patrons and tourists that visit us during Visit Malaysia Year 2025 the best Malaysia Hospitality experience we can offer,” it said.

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