KUALA LUMPUR: Malaysia can host world-class theme parks if the outdated entertainment duty tax is abolished, says the Malaysian Association of Theme Parks and Family Attractions (Matfa).
Its founding president Tan Sri Richard Koh said the entertainment tax, introduced decades ago under a different economic landscape, was a major stumbling block for industry growth.
He said the tax no longer reflected the role of modern theme parks and family attractions as key contributors to tourism, jobs and economic growth.
"Singapore abolished the entertainment tax, and today, they have Universal Studios which can attract three million visitors yearly. Hong Kong has Disneyland after dodging the tax. Malaysia can also have such world-class theme parks," Koh said.
"As neighbouring countries continue to adopt investment-friendly policies, Malaysia risks losing new investments and tourism spending unless we modernise our tax framework," he added.
Koh said the current tax inflated ticket prices for families and put local theme parks at a disadvantage compared to competitors in Singapore, Thailand and Indonesia.
Matfa is appealing to the Federal Government to use Budget 2027 to completely abolish the entertainment duty tax on theme parks, family attractions and children's playlands.
Koh said cutting the tax would lower ticket prices, stimulate domestic tourism and encourage repeat visits from international tourists.
"Rather than viewing this as a loss of tax revenue, it should be seen as an investment in the country's tourism economy," he said, adding that broader tax revenues would be generated through increased visitor spending and business activities.
Malaysian Association for Arts, Live Events, Concerts and Festivals senior adviser Rizal Kamal echoed the call for tax reform.
"Organisers now face different tax rates, approval processes and interpretations depending on the state where events are being held. We want a stable, long-term policy that creates confidence," Rizal said.
Malaysian Association of Film Exhibitors chairman Koh Mei Lee said about 600 cinemas nationwide had not undergone major refurbishment in over a decade due to tight margins.
"If the entertainment tax is removed or reduced, we will be able to refurbish and renovate the cinemas to ensure the industry’s long-term sustainability," she said.
