Tourism and Culture Minister Mohamed Nazri Aziz has purportedly promised extra incentives and a special consideration to a group of tourism associations to cushion the effects of the tourism tax.

Malaysian Inbound Tourism Association (Mita) president Uzaidi Udanis said this was the result of the meeting between them, the Malaysia Tourism Council (MTC) and Malaysia Chinese Tourism Association (MCTA) with the minister and his officers.

Uzaidi said they met with the minister because they were concerned about possible cancellations of contracted group tours from overseas as a result of the tourism tax.

"The minister has taken into account the situation of group tours with contracts and he has given his guarantee to give special consideration and incentives to avoid the cancellation of the contracts which will end on March 31, 2018," Uzaidi (photo) said at a press conference at the Malaysia Tourism Centre (Matic) today.

He explained that the Tourism Ministry currently provides incentives to such group tours through its agencies, such as Tourism Malaysia.

With the implementation of the tourism tax and their concerns about contracted group tours being cancelled due to rising costs of accommodation, he said the minister has said he would provide additional incentives.

"With this guarantee, it shows that the minister and the ministry are really concerned about issues faced by the tourism industry players, and Mita members specifically.

"We are confident that the best solution will be announced by the minister," Uzaidi said.

The Tourism Tax Act was passed by the Dewan Rakyat on April 6 this year. The new Act will see additional rates of between RM2.50 and RM20 being charged for one night's accommodation in a hotel.

The government is expected to collect RM654.62 million if the occupancy rate for the 11 million hotel rooms in the country reaches 60 per cent.

Nazri had also recently announced that the launch of the tourism tax may be postponed to Aug 1, as the government is not yet ready to implement it.

At a press conference later, Nazri confirmed that establishments, agencies, and associations with valid contracts involving accommodation fees will be exempted the tourism tax until the end of their contracts.

As most of these contracts end on March 31, 2018, he said that the cut-off date for the tax exemption will be on April 1, 2018.

For anyone who wishes to receive this exemption, they have to write to the ministry and confirm that they have a valid contract.

For example, he said, some travel agents might have signed contracts where they sell travel packages to group tours which include a set accommodation fee.

“As a lawyer, I understand, the contract has been drawn, and this will complicate things for them if we impose this tax because the (tourists who buy the packages) will say this tourism tax was never mentioned (in the package).

“For those with valid contracts, we will exempt them until their contract ends, and the final date is April 1,” he said.

Any new contract drawn up will have to include the tourism tax, he added.

“(So) don’t go signing new contracts (without the tourism tax) on April 1,” he quipped.