Reintroduce tax exemption incentives to support domestic travel

The Malaysian Tourism Federation has called upon the Finance Ministry to reintroduce tax exemption incentives to support domestic travel.

MTF wanted more inclusive tax incentives in Budget 2025 to accelerate tourism development.

Budget 2025 would be tabled by Prime Minister Datuk Seri Anwar Ibrahim who is also Finance Minister at a point in time when the gross domestic product percentage is at its best.

In addition to that Ringgit Malaysia has had its best performance against the USD. Similarly Malaysian stock exchange also saw some positive development.

The World Bank ranked Malaysia among the top three in the middle upper class.

The MTF said that tax incentives for organising domestic or international travel groups were withdrawn after it was given for a 10 year period since 2013.

The incentive required that operators organising international tour packages to Malaysia see participation of not less than 750 inbound tourists per year, while operators organising domestic tour packages see participation of not less than 1,500 local tourists per year.

The MTF also wants a revisit of the currently available tax incentives, including pioneer status eligibility for hotels that have up to three stars and convention centres, and income tax exemption for organising specific conferences and sports events.

“These incentives should be reviewed to ensure they remain relevant and practical to reflect the current business environment, failing which they need to be updated or repealed in Budget 2025.

“To position Malaysia as a premiere destination and increase international arrivals, there must be support and understanding from interlocking government agencies, more conducive policies and also aggressive private sector-driven initiatives backed by the government,” it said.

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