Budget 2025: Expand income tax incentives to boost high-end tourism, says hotels association S’wak chairman

KUCHING (Oct 5): The Malaysian government’s income tax exemption for one to three-star hotels ought to be extended to other four and five-star hotels, said Malaysian Association of Hotels (MAH) Sarawak Chapter chairman John Teo.

In sharing the tourism industry players’ wish list for Budget 2025, he said a comprehensive and tax efficient strategy will benefit Malaysia’s tourism sector as a whole and position the country as the world’s leading destination.

He said the one to three-star hotels which are granted the Pioneer Status can get to enjoy a five-year 70 per cent exemption from the payment of income tax.

By making these incentives applicable to other four and five-star hotels, he said this will attract high-end tourists to Malaysia and increase national revenue through value-added tourism.

Such inclusion will encourage four and five-star hotels to invest in sustainable practices, digital innovation, and workforce development, thus boosting efforts towards achieving a sustainable and competitive economy, he said in an interview with Utusan Borneo, the Borneo Post’s sister paper.

“The association members have also pushed for more tailored incentives, accelerated capital allowances and tax reliefs for the tourism industry players,” he said, adding that these issues had been constantly raised in every discussion and town hall meetings with the relevant ministries since 2021.

With hotels now adopting sustainable practices in line with the Ministry of Tourism, Arts, and Culture’s National Tourism Policy 2030, MAH has called upon the government to provide green incentives, grants, or tax relief for hotels that meet the credentials of the environmental, social, and governance (ESG) certification.

Meanwhile, on the hotel check-in policy where there were reports of some hotels implementing a check-in time of 4pm and a check-out time of 11am, Teo said it is not a major issue here in Sarawak as the hotel managements here are rather flexible.