The Malaysian Association of Tour and Travel Agents (Matta) has welcomed the government’s move to reduce the goods and services tax (GST) rate to zero percent effective June 1, 2018.
President, Tan Kok Liang said the move would boost the domestic travel industry - an important contributor to the Malaysian economy.
“It is bound to promote spending among locals and tourists, thus potentially increasing Malaysia’s appeal as a travel, shopping, food and beverage destination,” he said in a statement today.
Tan said flights between the Peninsular and Sabah and Sarawak would also be more affordable with zero-rated GST and augurs well for domestic tourism.
He said the policy shift would also bring consistency in the GST treatment between designated areas (Labuan, Langkawi and Tioman) and other local travel destinations.
“However, it is not entirely clear whether the GST needs to be charged for tours sold before June 1 for travels on or after that date,” said Tan, adding that the association has sought for clarification from the Royal Malaysian Customs Department on the matter.
Matta is the largest travel non-governmental organisation in Malaysia, with 3,300 members comprising local tour and travel agents and overseas affiliations.