Business

Tourism industry players question departure levy rationale

Datuk Tan Kok Liang

Datuk Tan Kok Liang

Shaira Idris
Written by Shaira Idris

KUALA LUMPUR – July 8, 2019: Tourism industry players are questioning the rationale behind the implementation of departure levy, which is likely to take effect in September.

Malaysian Association of Tour and Travel Agents (Matta) president Datuk Tan Kok Liang has reiterated his call on the government to carefully study the levy before implementing it.

“Matta did not say we are against the levy. Neither did we say that it will hurt tourism. We simply said study it first and see what are the implications,” Tan said to The Mole.

Moreover, Tan claimed that the government is keeping Matta officials on the edge of their seats, as they have apparently yet to be briefed on the mechanics of the levy system.

“What is the mechanism? How come none of us are aware? How are we going to pay? Through the airlines or the airport’s exit point? How are we going to set it up?,” Tan asked.

“We want to know how the system works… How are we going to collect the tax and we’d like to know if it will be a seamless experience for the travelers,” he added.

Commenting on whether the levy may cause a surge in flight ticket prices, thus taking a toll on tourism, Tan admitted that the amount is not significant in reference  to the additional charge of RM20 for Asean countries and RM40 for other international destinations.

“However, it probably won’t accelerate our tourism growth as what the government has projected.

“I wouldn’t say it will badly affect us, but it will still stifle our growth and projection because with this type of condition, tourists will take note. They will learn how to calculate better and would probably rather visit Thailand, Singapore or Indonesia,” he added.

Tan also claimed that the implementation of the departure levy is not compatible with the principles of International Air Transport Association (IATA).

“Looking at the feedback we received from IATA and from various debates in the parliament, I believe that we should have a welcoming policy rather than imposing the departure levy,” he said.

According to a recent report, IATA has deduced that the introduction of the levy would reduce the number of passengers departing Malaysia by air by up to 835,000 per year, decrease the aviation sector’s GDP (gross domestic product) contribution by up to US$419mil and see a reduction of up to 5,300 jobs.

Another report also highlighted that IATA has stated that an increase in prices will affect homegrown carriers such as Malaysia Airlines and AirAsia, putting them at a disadvantage to their counterparts in the region.

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Shaira Idris

Shaira Idris

Shaira is a 20-something accidental journalist who's currently still adapting to the world of journalism and learning the ropes of her job.