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Galakan Cukai

  • Syarikat pengendalian pelancongan yang menyediakan pakej pelancongan domestik bagi pengembaraan dalam Malaysia yang digunakan oleh pelancong tempatan DAN pelancong asing, termasuk pengangkutan melalui udara, darat atau laut  DAN penginapan .
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  • Syarikat pengendalian pelancongan yang berlesen dengan MOTAC  dan mempunyai lesen yang sah semasa memohon sokongan pelepasan cukai.
  • Permohonan pelepasan cukai adalah  bagi tahun taksiran 2021   sehingga tahun taksiran 2022 .
  • Permohonan sokongan pelepasan cukai dari MOTAC perlu dikemukakan dalam tempoh enam (6) bulan selepas   tahun kewangan syarikat berakhir .
  • Sekiranya diminta, pihak Audit Awam bertauliah/syarikat hendaklah mengemukan dokumen-dokumen (bil/resit/invois/itinerari) yang berkaitan dengan tuntutan tersebut untuk disemak oleh MOTAC. Dokumen-dokumen tersebut  perlu disediakan  dalam  Bahasa Melayu atau Bahasa Inggeris .
  • Syarikat pengendalian pelancongan yang memohon pengecualian cukai hendaklah  menyenggara suatu akaun berasingan  bagi pendapatan yang diperolehi daripada setiap aktiviti yang layak diberi pengecualian tertakluk kepada syarat akaun tersebut dipersetujui oleh Lembaga Hasil Dalam Negeri Malaysia (LHDNM).
  • Surat sokongan daripada MOTAC hanya akan dikemukakan kepada syarikat pengendalian pelancongan setelah MOTAC berpuas hati dengan pengesahan yang diberikan oleh Audit Awam yang bertauliah/syarikat.
  • Borang permohonan yang lengkap diisi kemukakan kepada : Ketua Setiausaha Kementerian Pelancongan, Seni dan Budaya Malaysia Bahagian Pembangunan Industri Tingkat 14, Menara 1 No. 2, Jalan P5/6, Presint 5 62200 PUTRAJAYA
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Corporate - Tax credits and incentives

Malaysia has a wide variety of incentives covering the major industry sectors. Tax incentives can be granted through income exemption or by way of allowances. Where incentives are given by way of allowances, any unutilised allowances may be carried forward indefinitely to be utilised against future statutory income, except for certain incentives, such as reinvestment allowance and investment allowance for approved service projects, where a seven-year limitation applies.

In compliance with the Forum on Harmful Tax Practices (FHTP) criteria under the Base Erosion and Profit Shifting (BEPS) Action 5 (Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance), Malaysia has amended the legislation in relation to the tax incentives to:

  • remove ring-fencing features
  • exclude IP income from the incentives, and 
  • stipulate the substantial activities requirements.

The following are the major types of incentives available in Malaysia.

Pioneer status (PS) and investment tax allowance (ITA)

Companies in the manufacturing, agricultural, and hotel and tourism sectors, or any other industrial or commercial sector, that participate in a promoted activity or produce a promoted product may be eligible for either PS or ITA.

PS is given by way of exemption from CIT on 70% of the statutory income for five years and the remaining 30% is taxed at the prevailing CIT rate. ITA is granted on 60% qualifying capital expenditure incurred for a period of five years and is utilised against 70% of the statutory income, while the 30% balance is taxed at the prevailing CIT rate.

A company that intends to undertake reinvestment before expiration of its PS or ITA status may opt for reinvestment allowance, provided it surrenders its PS or ITA status.

The PS and ITA incentives are enhanced for the following types of projects:

  • Tax relief period (in terms of years).
  • Statutory income.
  • Qualifying capital expenditure.

Special incentive schemes

Reinvestment allowance.

A resident company in operation for not less than 36 months that incurs capital expenditure to expand, modernise, automate, or diversify its existing manufacturing business or approved agricultural project is entitled to reinvestment allowance as follows:

  • The allowance is given for 15 years from the first year of claim.
  • The allowance is computed at 60% of QCE incurred and can be utilised against 70% of statutory income. 
  • The 70% restriction does not apply to projects that have achieved the level of productivity as prescribed by the Minister of Finance.
  • The allowance will be withdrawn if the asset for which the allowance is granted is disposed of within five years.

A special reinvestment allowance of 60% of QCE will be given for years of assessment 2020 to 2024 for companies that have exhausted their existing 15-year reinvestment allowance period and special reinvestment allowance granted for years of assessment 2016 to 2018.

Incentives for relocating to Malaysia

The following incentives are given to encourage investment and relocation of manufacturing or services  operations into Malaysia:

  • 0% tax rate for 10 or 15 years for new companies that invest a minimum of MYR 300 million or MYR 500 million, respectively, in the manufacturing sector in Malaysia.
  • ITA of 100% for five years for existing companies in Malaysia to relocate their overseas manufacturing facility for a new business segment to Malaysia with a minimum investment of MYR 300 million.
  • 0% to 10% tax rate for up to ten years for new companies that relocate their services facility or establish new services in Malaysia.
  • 10% tax rate for up to ten years for existing companies in Malaysia that undertake services activities for a new business segment in Malaysia.

Applications must be received by 31 December 2022. The government has proposed an extension of this incentive, but details have not been released yet.

Approved service projects

A resident company undertaking a project approved by the Minister of Finance in the transportation, communications, utilities, and services subsectors may enjoy the following incentives:

  • Investment allowance of 60% of QCE incurred within five years to be utilised against 70% of statutory income, or income tax exemption of 70% of statutory income for a period of five years.
  • Buildings used solely for the purposes of such projects qualify for an industrial building allowance.

Export incentives

A resident company engaged in manufacturing or agriculture that exports manufactured products, agricultural produce, or services is entitled to allowances between 10% and 100% of value of increased exports (subject to satisfying prescribed conditions), which is deductible at up to 70% of statutory income.

Regional operations

International trading company.

International trading companies are exempted on income equivalent to 20% of increased export value to be set off against a maximum of 70% of statutory income, for a period of five years. To qualify for the incentive, the company must meet the following three conditions:

  • Incorporated in Malaysia, with 60% Malaysian ownership.
  • Achieve minimum annual sales of MYR 10 million, of which not more than 20% of its annual sales may be derived from the trading of commodities.
  • Use local services (banking, finance, and insurance) and infrastructure (local ports and airports) in its operations.

Financial services sector

Islamic fund management.

Full income tax exemption is available on statutory income on management fees received by resident fund management companies for managing funds of foreign and local investors established under Syariah principles (until year of assessment 2023). Such funds must be approved by the Securities Commission.

Tun Razak Exchange (TRX) (formerly known as Kuala Lumpur International Financial District)

The TRX is an integrated property development comprising office towers for finance and banking, residences, and retail spaces in Kuala Lumpur. To accelerate the development of the TRX, the following incentives have been given:

  • Income tax exemption of 70% of statutory income from the disposal of any building or rights over a building, or part thereof, for five years up to year of assessment 2025, for property developers in TRX.
  • Income tax exemption of 70% of statutory income from the rental of any building, or part thereof, for five years up to year of assessment 2027, for property developers in TRX.
  • Additional 50% tax deduction of rental payment incurred by TRX Marquee status companies for buildings used for business in TRX.
  • 10% industrial building allowance for TRX Marquee status companies for qualifying building expenditure that is incurred up to 31 December 2025.
  • Accelerated capital allowance incentive for renovation costs incurred by TRX Marquee status companies up to 31 December 2025.
  • Single deduction for prescribed relocation costs incurred by TRX Marquee status companies for relocation that takes place not later than 31 December 2025.

Real estate investment trusts (REIT)/Property trust fund (PTF)

REIT/PTFs are vehicles that mobilise funds from unit holders comprising individuals and companies for investments in the property sector and related assets. REIT/PTFs are exempted from tax on all income, provided that at least 90% of their total income is distributed to unit holders. This exemption only applies to REIT/PTFs that are listed on the Bursa Malaysia. If the 90% distribution condition is not complied with, all income will be taxed at the prevailing income tax rate at the REIT/PTF level and tax credit will be claimed by the unit holders on distributions received from the REIT/PTF.

Unit holders are taxed as follows:

Other incentives available are:

  • RPGT and stamp duty exemptions on disposal/transfer of real property to an REIT/PTF.
  • Tax deduction given for consultancy, legal, and valuation service fees incurred on the establishment of an REIT.

Venture capital company (VCC)

A VCC investing in a venture company (VC), which is not the VCC’s related company at the point of first investment, will be given a deduction on the value of investment made in a VC until 31 December 2026. Where the deduction is not claimed, the VCC is eligible for the following income tax exemption on income from all sources, other than interest income from savings or fixed deposits, and profits from Syariah-based deposits:

Petroleum sector

The following incentives are provided for petroleum operations:

  • Accelerated capital allowance on QCE incurred from year of assessment 2010 to 2024 for petroleum operations in marginal fields.
  • Investment allowance of 60% of qualifying capital expenditure to be utilised against 70% statutory income for a period of ten years.
  • Exemption for a portion of chargeable income from marginal fields resulting in a reduction of the effective tax rate from 38% to 25% for petroleum operations in marginal fields.
  • Petroleum income tax rate at 25%.
  • Accelerated capital allowance within two years.
  • Carryback of losses from decommissioning activities to two consecutive preceding years of assessment.
  • Export duty exemption on petroleum products.

Special economic regions

The following special economic regions were launched as part of the Malaysian government’s plan for regional growth and development:

Various incentives are provided for these special economic regions. The following are some of the incentives available for specific sectors of the special economic region.

Iskandar Malaysia

An Iskandar Development Region (IDR) status company is given income tax exemption on statutory income for ten years from the provision of qualifying services to a person situated within designated nodes in the IDR. Operations must commence on or before 31 December 2024.

Northern Corridor Economic Region

The following are the priority sectors in the region:

  • Manufacturing.
  • Agribusiness.
  • Petrochemical.
  • Green economy.
  • Sustainable mining.

The incentives available are:

  • Income tax exemption up to 100% for up to 15 years.
  • Investment tax allowance up to 100% of QCE for up to ten years. 
  • Import duty exemption on raw materials, components, machinery, and equipment.
  • Stamp duty exemption of 50% on instrument of transfer or lease of land. 

East Coast Economic Region

Sabah development corridor (sdc).

The competitive sectors in the region are tourism, manufacturing, agri-processing, and logistics. The following incentives are available for qualifying companies operating in the SDC:

  • 100% income tax exemption for ten years of assessment. 
  • Income tax exemption equivalent to 100% of QCE incurred for five years.
  • Stamp duty exemption for land acquired for development (selected sectors).
  • Import duty and sales tax exemption for raw materials, components, machinery, and equipment.

Green incentives

Green technology projects.

Companies that undertake any of the following green technology projects will be eligible for an ITA of 100% of QCE against 70% statutory income for QCE incurred for three years (applications to be received by 31 December 2023):

  • Renewable energy.
  • Energy efficiency.
  • Green building.
  • Green data centre.
  • Integrated waste management.

Green technology services

Companies that provide services, such as advisory, design, feasibility study, testing, and commissioning, in the following areas will be eligible for income tax exemption of 70% of statutory income for three years (applications to be received by 31 December 2023):

  • Electric vehicle.
  • Green certification and verification.
  • Green township.

Solar leasing

Companies engaged in solar leasing are eligible for income tax exemption of 70% of statutory income for five or ten years based on the energy production capacity (applications to be received by 31 December 2023).

Green technology assets

Companies that purchase green technology assets listed on the MyHijau directory will be eligible for an ITA of 100% of QCE incurred from 25 October 2013 to 31 December 2023, to be set off against 70% of statutory income (applications to be received by 31 December 2023).

Biotechnology industry

Companies undertaking biotechnology activity with approved bionexus status from Malaysian Bioeconomy Development Corporation Sdn Bhd will be eligible for the following incentives:

  • 100% income tax exemption on statutory income for ten years from the first year in which the company derives statutory income or income tax exemption equivalent to a rate of 100% on QCE incurred for a period of five years to be utilised against 70% of statutory income.
  • Concessionary tax rate of 20% on statutory income from qualifying activities for ten years upon expiry of the original tax-exempt period.
  • Accelerated industrial building allowance (over ten years) for buildings used solely for the purpose of its new business or expansion project.
  • Exemption of import duty and sales tax on import of raw materials and machinery.

Research and development (R&D)

Contract r&d company.

Companies that provide R&D services to third parties are eligible for:

  • PS of 100% of statutory income for five years (extendable by five years), or
  • ITA of 100% of QCE incurred within a period of ten (extendable by ten years) to be utilised against 70% of statutory income.

R&D company

ITA of 100% of QCE for a period of ten years (extendable by ten years) to be utilised against 70% of statutory income.

In-house R&D

Companies undertaking in-house R&D projects are eligible for ITA at the rate of 50% of QCE incurred within a period of ten years (extendable by ten years) to be utilised against 70% of statutory income.

Commercialisation of resource-based R&D findings

A company that invests for the sole purpose of financing a project on commercialisation of resource-based R&D findings (which is wholly owned by a public research institute or public or private institute of higher learning in Malaysia) is given a deduction equivalent to the value of that investment.

The subsidiary undertaking the commercialisation of R&D findings is granted 100% tax exemption on statutory income for ten years.

Other incentives

Shipbuilding and repairing (sbsr).

The following incentives are available for SBSR (applications to be received by 31 December 2022; the government has proposed an extension of this incentive to 2027 but details have not been released yet):

  • Tax exemption of 70% of statutory income for five years, or ITA of 60% of QCE incurred within five years to be set off against 70% statutory income, for new companies.
  • ITA of 60% of QCE incurred within five years to be set off against 70% statutory income for existing companies that have not enjoyed the SBSR incentive.

Incentives for Mines Wellness City (MWC)

The following incentives are available for MWC:

Capital allowance for increased automation

Manufacturing companies that have been engaged in manufacturing activities for at least 36 months are eligible for the following incentives, where they have incurred expenditure in more technologically advanced automation equipment used directly in the manufacturing activities and which results in reduced man hours and increased productivity:

  • For high labour-intensive industries (rubber products, plastics, wood, furniture, and textiles industries): 200% automation capital allowance on first MYR 4 million QCE (for years of assessment 2015 to 2023).
  • Other industries: 200% automation capital allowance on first MYR 2 million QCE (for years of assessment 2015 to 2023).

Foreign tax credit

See Foreign income in the Income determination section for a discussion of the foreign tax credit regime.

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Press Citations

Budget 2022: seven key initiatives to revive tourism sector.

Budget 2022: Seven key initiatives to revive tourism sector

KUALA LUMPUR, Oct 29 -- Seven key initiatives, involving a total value of RM1.6 billion, will be implemented next year to revive the tourism sector which has been badly affected by the COVID-19 pandemic.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said it included a Wage Subsidy Programme, which specifically targeted tourism operators whose income dropped by at least 30 per cent.

"With an allocation of RM600 million, this initiative will benefit more than 26,000 employers and 330,000 employees," he said when tabling the 2022 Budget in the Dewan Rakyat today.

He said the government was also allocating RM600 million as specific financing for the tourism sector under PENJANA Tourism Financing and BPMB Rehabilitation Scheme; RM85 million in special assistance to more than 20,000 tourism operators registered under the Ministry of Tourism, Arts and Culture (MOTAC) for a period of three months and RM50 million formaintenance of tourism infrastructure, including the Sultan Abdul Samad Building and Lembah Bujang in Kedah.

A sum of RM30 million is allocated in matching grants for repair of 738 budget hotels that are registered under MOTAC, as well as for registered home stay owners; RM50 million in matching grants to companies to organise arts and culture-related programmes, as well as RM60 million in incentive funds for activities to promote domestic tourism.

Meanwhile, Tengku Zafrul said special individual income tax relief for domestic tourism expenses of up to RM1,000 would be extended until the year of assessment 2022.

He said the government would intensify efforts to promptly revive the international health tourism industry to strengthen Malaysia's position as a preferred health tourism destination with an allocation of RM20 million to the Malaysia Healthcare Travel Council.

"The government also plans to extend several tax incentives including income tax exemption to organisers of arts and cultural activities, as well as international sports and recreational competitions until the year of assessment 2025," he added.

Meanwhile, he said the exemption on entertainment duty, including for theme parks and cinemas in all Federal Territories, and the tourism tax exemption would be extended until Dec 31, 2022.

He also suggested for state governments to also provide exemption on entertainment duty to support the recovery of the sector.

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Tax rebate for domestic travel among incentives proposed to bolster industry

Thursday, 05 Jan 2023

Related News

Marcos govt capped 2023 with fatter borrowings

Marcos govt capped 2023 with fatter borrowings

Asean news headlines at 9pm on monday (march 4, 2023), asean news headlines at 9pm on saturday (march 2, 2023).

PETALING JAYA: Tax incentives for locals to travel domestically should be introduced in the revised Budget 2023, says the Malaysia Budget and Business Hotel Association.

Its president Dr Sri Ganesh Michiel said the move would both drive and boost the local tourism and hotel industry.

He suggested the government introduce a rebate of RM3,000 for locals to travel domestically.

"This will be a good amount to start with and it will re-stimulate not only local tourism but also the hotel industry.

"We need to find a win-win solution in order to ensure sustainability for all parties," he said, when contacted.

Prime Minister Datuk Seri Anwar Ibrahim will table the revised Budget 2023 in Dewan Rakyat on Feb 24.

According to Parliament's official portal, the first meeting of the second session of the 15th Parliament will run from Feb 13 until March 30, 2023.

Previously, the government had targeted more than 15 million foreign tourists arrivals this year with a projected income value of RM47bil.

Sri Ganesh also urged the government to raise the annual threshold value of the Sales and Service Tax (SST) for the hotel industry from RM500,000 to RM1.5mil in the Budget.

"If the government can increase the SST threshold for eateries and restaurants from RM500,000 to RM1.5mil, there is no excuse that it cannot be given to our industry," he said.

He also urged the government to improve the mechanism to collect tourism tax and to avoid any leakages especially for online bookings.

Malaysian Inbound Tourism Association (Mita) president Uzaidi Udanis said the government needs to allocate more funds to promote Malaysia at the international level.

"It is costly for local players to do promotions and they need to attend a lot of international conferences.

"Perhaps the government can look at providing special matching grants for this purpose.

"We need to make sure we are able to put Malaysia on the world map again after the Covid-19 pandemic," he said.

He also urged the government to do away with redundant regulations and red tape that can discourage local players from being active in the industry.

"I believe that there needs to be a clear guideline and enforcement at all levels to ensure that we are able to attract quality tourists, especially in terms of safety at popular tourist sites," he said.

He also hoped the government could help rural folk promote marketable tourism products such as durian farms and eco-tourism.

Tags / Keywords: Budget 2023 , tourism , Covid-19 , Tax , incentives

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Malaysia Makes Tax Exemptions for Tourism in 2020

  • Taxation and GST
  • Malaysia Makes Tax Exemptions for…

Budget 2020: Malaysia Makes Tax Exemptions for Tourism

Budget 2020: Malaysia Makes Tax Exemptions for Tourism

Budget 2020 budget will offer tax incentives to companies that want to invest in tourism businesses . These include theme parks and organisers of international cultural and sports programmes. 

Thanks to the tax exemptions for tourism, n ew investments in international theme park projects will be given income tax exemption of 100%. Also, it includes the Investment Tax Allowance of 100% to be set off against 70% for five years.

Tax Exemption for Tourism

The government will allocate a total of RM1.1 billion to the Tourism, Arts, and Culture Ministry. This money is meant to promote relevant programs that support the Visit Malaysia 2020 plan.

The government will continue to allocate 50 percent of tourism tax to respective state governments to support their efforts in conjunction with VMY2020. Also, the government will allocate a substantial portion of the departure levy collected for tourism infrastructure projects.

Also, in conjunction with the same movement, the Malaysian government is giving a 50% excise duty reduction for any vehicles made within Malaysia. This would only be for tour operations vehicles.

The Cultural Economy Development Agency (CENDANA) will not be left out of this movement. The government awards a budget of RM5 million to support only art exhibitions and visual art galleries.

It is not just mainstream tourism that is trying to grow; the Malaysian medical tourism is also getting a big boost. The Year of Healthcare Travel 2020 program would be expanded to the growing base of medical tourism in the area. 

Medical tourism is a rapidly expanding industry in Malaysia, growing 17 percent annually from 2015 until 2018. In 2018, it generated RM1.5 billion revenue receipts from 1.2 million healthcare travellers.

To further support the Malaysian Healthcare Tourism Council, it will receive RM25 million to revamp their services. This is to help Malaysia become the next best stop for medical tourists in entire Asia.

Tax Exemptions for Support of Arts and Culture

The tax exemptions for tourism would also be extended to businesses that support arts and cultural activities in the country. This is to encourage other businesses to take notice of and support the cultural scene. In doing so, these activities help bring invaluable foreign income from tourists eager to experience the local culture. Companies that support arts and cultural activities will receive tax incentives in the form of income tax exemption. The tax deductions given to companies sponsoring arts, cultural and heritage activities in Malaysia will increase from RM700,000 to RM1,000,000 per year.

Related posts:

  • Update on GST and commercial property in Malaysia
  • Minister’s Relief 1/2017 – Relief from charging of GST
  • Tax Incentive for Returning Expert Programme
  • Malaysia Middle-Income Tax Lowered By 2 Per Cent

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Malaysia Middle-Income Tax Lowered By 2 Per Cent

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Malaysia: Tax Exemptions For Foreign Investors In Malaysia

View Yuki  Hashimoto Biography on their website

1. Tax exemptions for foreign investors in Malaysia

According to the 2022 Milken Institute Global Opportunity Index (GIO), Malaysia is the most attractive destination in Southeast Asia for foreign investors. Behind this success are the irresistible tax incentives offered by the Malaysian government.

Tax incentives in Malaysia, direct and indirect, are provided for in the Promotion of Investments Act 1986, Income Tax Act 1967, Customs Act 1967, Excise Act 1976 and Free Zones Act 1990.

2. Some of the major incentives are as follows,

  • Pioneer status (income tax exemption ranging from 70% to 100% for a period of 5 to 10 years);
  • Investment tax allowance (60% to 100% on qualifying capital expenditure incurred within 5 years);
  • Reinvestment Allowance (60% on qualifying capital expenditure incurred for 15 consecutive years); and
  • Import Duty Exemption/Customised Packaged Investment incentives.

(1) There are different types of incentives available for new and existing foreign investors in Malaysia.

Generally, new investors are eligible to enjoy all incentives if they are providing the promoted activities or promoted products. Whereas existing foreign investors' options are more limited, for example, existing investors may be able to get,

  • Green technology incentive;
  • Principal Hub / Global Trading Centre incentive; and
  • Reinvestment allowance

(2) Importance to understand these incentives

Many foreign investors are unaware of their eligibility for these incentives, and thus, have been paying taxes that could have been exempted.

One Asia Lawyers have excellent contacts with government agencies that will be approving these tax incentives.

Below is a list of incentives that are available as of 24 June 2022.

Note, these incentives usually come in the form of Pioneer status and Investment tax allowance, sometimes duty exemption and reinvestment allowance are attached too. Companies may be able to save a significant amount of money under some of these incentives.

Government policies on tax incentives change rapidly, do contact us at [email protected] to find out if you are qualified for any of the tax exemptions.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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tax incentive for tourism industry in malaysia

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Malaysia Tourism Tax (TTX) 2023: What You Need to Know

In line with the announcement made by the Malaysian government regarding the Tourism Tax , I will talk about a series of questions that are commonly asked by hotel owners or operators, thus helping all of you to find the answers that are related to it. 

1. What is a Tourism Tax?

Tourism Tax (TTx) is referred to as a tax charged for all foreign passport holders at accommodations premises collected by the operators effective from 1st September 2017 in Malaysia. It is charged at a fixed rate of RM10.00 per room per night.  However, during the Covid-19 pandemic, The Malaysian Government has announced the exemption of the Tourism Tax for all foreign passport holders for hotel stays between 1st March 2020 and 31st December 2021 then further extends to 31st December 2022.  Now, the Malaysian government has announced that the Tourism Tax will resume back starting from 1st January 2023. 

2. How is the RM10 per room per night applied?

Assuming one room is booked for one night by John (who is a Filipino), the TTx charged to John will be RM10.00 x 1 room x 1 night = RM10.00  In the 2nd Scenario, assuming two rooms were booked by Dianne (who is an Indonesian) for three nights, so the TTx charged to Dianne will be RM10.00 x 2  rooms x 3 nights = RM60.00 

3. How is this new to the travel industry starting January 2023?

Since September 2017, a guest who is a foreigner is subject to paying Tourism Tax when staying at any “accommodation premises” in Malaysia; this tax is collected by the operator at the accommodation premises upon check-in, regardless if the booking was made online or walk-in. However, starting from 1st January 2023. For any bookings made through digital platforms that provide reservation services such as booking.com, Agoda, and Expedia, the platform is the one to collect the Tourism Tax directly from the foreign guests when the guest made the booking and payment online through the platform. The digital platform provider shall remit the tax collected to the RMCD. Whereas, for booking that was made online through the platform but payment only upon arrival at the accommodation premises, the TTx shall be collected by the accommodation operator upon guest arrival. The responsibility of remitting the tax collected for this booking shall be by the accommodation operator instead.

We have just received the update that currently, only AGODA will collect the TTx directly from the guest together with the room charges if they made the payment online. Whereas, for other OTAs like Expedia, Booking.com & Traveloka, the TTx will be collected upon check-in by the property operator, UNTIL FURTHER NOTICE. 

4. What if the booking has been made before 1st January 2023 for the check-in date after on or 1st January 2023? 

If a foreign traveller has made a booking on a digital platform before 1st  January 2023, for check-in on or after 1st of January 2023, the Tourism Tax must be collected by the accommodation operator upon guest arrival and the accommodation operator is required to remit the tax to the RMCD.

5. What if my property did not register for TTx? 

We advise you to further consult with your business advisor or check with RMCD if you have not registered as a Tourism Tax registrant. Generally, if you are operating accommodation premises of 5 rooms or more, you are liable to be registered.  You may also check this website https://www.myttx.customs.gov.my/ to further understand the registration. 

6. If a Malaysian with his foreign friend both check into the same room and the booking was made and paid by the Malaysian, is TTx chargeable? 

In this case, it is not subject to Tourism Tax because a local stayed and paid for the stay. However, the Tourism Tax is chargeable in the event that the foreigner stays and pays for the stay.

7. If the reservation has been made with full payment together with the TTx for the booking made via OTAs, then the guest request for the cancellation on a non-refundable policy, will the TTx will be refunded?

Unfortunately, we are unsure of this. Do let us know in the comment section if you have more information regarding this. What I can say is, you may refer to the T&C directly from the OTAs. 

8. Will TTx subject to SST too? 

No. The operator is not allowed to charge SST on the Tourism Tax. 

9.  Is day use chargeable to TTx?

No, if the day use charge is not equal to the room rate per night.

10. Is a Digital Platform provider compulsory to collect private data such as passport no. or ID no. to ensure nationality?

Yes. The Digital Platform provider should make an appropriate adjustment in its system to capture the information that is to identify the citizenship of the tourists.

11. John makes an accommodation booking online and provides inaccurate information which resulted in TTx not being collec ted. Who wi ll be responsible? 

If due diligence has been done to obtain the information required from the tourists, the Digital Platform provider will not be responsible for any inaccurate information provided by the tourist, which may result in the under-collection of TTx. 

Check out this video where we answer a frequently asked question regarding the Tourism Tax

That’s all 11 common questions that we heard so far regarding the Malaysia Tourism Tax. Please share this article if you find it useful and drop any questions in the comment sections if you think there are more questions that should be answered. 

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Kindly be informed that the imposition of tourism tax on foreign tourist staying at an accommodation premise booked through a registered Digital Platform Service Provider (DPSP) will be implemented effective on 1st January 2023.

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Income tax exemption on medical tourism

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Tax alert vol 23 no 7_11 may 2020.

A company that provides private healthcare facilities and services to a healthcare traveler (as defined) was previously given a tax exemption on its income. Such exemption was equivalent to an investment tax allowance of 100% of the qualifying capital expenditure incurred for a period of five (5) years. The incentive applied to applications received by the Malaysian Investment Development Authority (MIDA) between 1 January 2015 and 31 December 2017 and was given to new companies as well as existing ones engaged in expansion, modernization or refurbishment, subject to conditions (see Tax Alert No. 16/2017 ).

In Budget 2018, the Government proposed to extend this incentive for another three years, until 31 December 2020 (see Special Tax Alert: Highlights of 2018 Budget – Part I ) subject to stricter conditions. Now, at least 10% (instead of the previous 5%) of a qualifying company’s total number of patients per YA must be made up of healthcare travelers. Further, at least 10% (instead of the previous 5%) of the company’s gross income for each YA must be derived from the healthcare travelers.

Following the above proposals, MIDA issued the following two guidelines dated 8 February 2018:

(a)   Guideline on the application for tax incentive for the promotion of healthcare travel:

        I.     New private healthcare facility

        II.    Expansion / modernization / refurbishment of an existing private healthcare facility

(b)  Guideline on the application for verification of plant / machinery / medical devices / other facilities used for the purpose of private healthcare facility promoting healthcare travel

The Income Tax (Exemption) (No. 2) Order 2020 [P.U. (A) 141] was gazetted on 5 May 2020 to legislate the above-mentioned proposals.

The Order provides an income tax exemption on the statutory income derived from a qualifying project carried on by a qualifying company. The amount of tax exempted shall be equal to the amount of qualifying capital expenditure incurred by the qualifying company. The exemption is for a period of five consecutive years commencing from the date that the qualifying company first incurs qualifying capital expenditure, as determined by MIDA, and shall not be earlier than 1 January 2018.

In addition, as highlighted above, the additional conditions set out in the Order are as follows:

  • The number of health travelers who receive private healthcare services from the qualifying project must be at least 10% (previously 5%) of the total number of patients from the qualifying project for each YA; and
  • At least 10% (previously 5%) of the gross income of the qualifying company from the qualifying project for each YA must be generated from the health travelers.

The Order is deemed to have come into operation from YA 2018, and applies to applications made to MIDA between 1 January 2018 and 31 December 2020.

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    In the following pages, we provide a summary of the main tax incentives for the relevant industry sectors. ... Further deduction on overseas promotion of tourism in Malaysia-Tour operators. Accelerated Capital Allowance (ACA) (Initial Allowance (IA) of 20% & Annual Allowance (AA) of 40%) on QE incurred on the purchase of new locally assembled ...

  2. Hospitality (Hotels and Tourism)

    The government is aiming for hospital revenues from medical tourism to reach RM1.2 billion this year and RM2.4 billion in 2025, according to the Malaysia Healthcare Travel Council (MHTC). Tourism investments have not kept up with global trends despite an increase in passenger traffic and international travel.

  3. Tax Incentives

    Ketua Setiausaha. Kementerian Pelancongan, Seni dan Budaya Malaysia. Bahagian Pembangunan Industri. Tingkat 14, Menara 1. No. 2, Jalan P5/6, Presint 5. 62200 PUTRAJAYA. MOTAC tidak terikat untuk memaklumkan sebab-sebab penolakan permohonan. Kegagalan mengemukakan dokumen lengkap berdasarkan senarai semak boleh menyebabkan permohonan ditolak.

  4. Tax incentive for tour operators extended

    Tax incentive for tour operators extended. Under the Strategic Programme to Empower the People and Economy (PEMERKASA) unveiled on 17 March 2021, the Government announced that the tax incentives for tour operators will be extended until the year of assessment (YA) 2022 (previously YA 2020) (see Special Tax Alert No. 2/2021).. To legislate the proposal, the Income Tax (Exemption) (No. 9) Order ...

  5. Malaysia

    Corporate - Tax credits and incentives. Malaysia has a wide variety of incentives covering the major industry sectors. Tax incentives can be granted through income exemption or by way of allowances. Where incentives are given by way of allowances, any unutilised allowances may be carried forward indefinitely to be utilised against future ...

  6. Incentives

    INCENTIVES FOR NEW INVESTMENTS. In Malaysia, tax incentives, both direct and indirect, are provided for in the Promotion of Investments Act 1986, Income Tax Act 1967, Customs Act 1967, Excise Act 1976 and Free Zones Act 1990. These Acts cover investments in the manufacturing, agriculture, tourism (including hotel) and approved services sectors ...

  7. PDF TOURISM AND

    6.3 Tax Exemption for Promoting International Conference 23 and Trade Exhibitions 6.4 Double Deduction on Cultural Performances 23 6.5 Incentives for the Luxury Yacht Industry 24 6.6 Incentive for the Promotion of Healthcare Travel 24 7 GENERAL AGREEMENT ON TRADE IN SERVICES (GATS) 26 ASEAN FRAMEWORK AGREEMENT ON SERVICES (AFAS)

  8. Budget 2022: Seven key initiatives to revive tourism sector

    He said the government would intensify efforts to promptly revive the international health tourism industry to strengthen Malaysia's position as a preferred health tourism destination with an allocation of RM20 million to the Malaysia Healthcare Travel Council. "The government also plans to extend several tax incentives including income tax ...

  9. Budget 2023: full tax exemption for tourism operators' statutory

    KUALA LUMPUR - The government has announced 100% tax exemption for statutory incomes - referring to not just monthly salaries but also to commissions, bonuses, allowances and so on - made by tourism operators in Malaysia next year. Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz said this shall contribute towards part of the ...

  10. PDF 18 March 2021

    Stimulating tourism and retail industries (con't) Extension of tax incentive for tour operators Tour operators were eligible for tax exemption on statutory income derived from domestic and group inclusive tours. The exemptions were given up to YA 2020. It is announced that tax incentives for tour operators will be extended up to YA 2022.

  11. Tax rebate for domestic travel among incentives proposed to bolster

    9:01 PM MYT. PETALING JAYA: Tax incentives for locals to travel domestically should be introduced in the revised Budget 2023, says the Malaysia Budget and Business Hotel Association. Its president ...

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    FMT Reporters - 03 Dec 2021, 8:05am. A business and economics expert says tax incentives can help tourism companies recover faster from the impact of Covid-19 lockdowns. PETALING JAYA: The slew of ...

  13. Tourism players want another round of incentives to stay in business

    Triways Travel Network (M) Sdn Bhd group MD Mohd Akil Yusof said the incentives could help the industry players to return and stay in the tourism sector. "Before the pandemic, there were 3,600 members (tourism businesses) registered with the Malaysian Association of Tour and Travel Agents (Matta), but now there are only 2,200.

  14. PDF GUIDE ON TOURISM TAX

    IMPOSITION OF TAX ON DPSP. 5. Any person who provide digital platform services whether located in Malaysia or outside Malaysia, on providing digital platform relating to online booking accommodation premises in which the accommodation premises is in Malaysia shall be liable to be registered for TTx. 6.

  15. Malaysia Budget 2020

    Tax Exemptions for Tourism is a bold effort to boost the presence of tourists in Malaysia. Budget 2020 budget will offer tax incentives to companies that want to invest in tourism businesses. These include theme parks and organisers of international cultural and sports programmes. Thanks to the tax exemptions for tourism, n ew investments in ...

  16. Budget 2020: Tax exemptions, incentives for tourism sector in

    Among the VMY2020 programmes, Malaysia would also be hosting Year of Healthcare Travel 2020 to solidify Malaysia's leading position as a medical tourist destination in the region. "Medical tourism is a rapidly expanding sector in Malaysia, growing 17 per cent annually from 2015 until 2018.

  17. Incentives in 2023 Budget will boost growth of tourism industry, says

    Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz, when tabling the 2023 Budget on Friday, said the government had allocated RM25 million for incentives to encourage Keluarga Malaysia to go on holiday to a domestic destination of their choice. He said the incentives were in the form of discounts, vouchers and rebates for lodgings ...

  18. Provide tax breaks to revive tourism industry, govt told

    PETALING JAYA: Grants, soft loans and tax incentives are needed to revamp and revive the tourism industry, says the Malaysian Association of Hotels (MAH), which hopes the government will look into ...

  19. Malaysia: Tax Exemptions For Foreign Investors In Malaysia

    Tax incentives in Malaysia, direct and indirect, are provided for in the Promotion of Investments Act 1986, Income Tax Act 1967, Customs Act 1967, Excise Act 1976 and Free Zones Act 1990. ... Incentive for Tourism Project (New Investment) (For companies making investments in tourism projects) MITI - Ministry of International Trade and ...

  20. Malaysia Tourism Tax (TTX) 2023: What You Need to Know

    Now, the Malaysian government has announced that the Tourism Tax will resume back starting from 1st January 2023. 2. How is the RM10 per room per night applied? Assuming one room is booked for one night by John (who is a Filipino), the TTx charged to John will be RM10.00 x 1 room x 1 night = RM10.00. In the 2nd Scenario, assuming two rooms were ...

  21. Encourage domestic tourism with tax rebates, says industry player

    Malaysia must revive its traditional arts scene, including batik printing, to draw tourists, a tourism NGO said. (Bernama pic) PETALING JAYA: The government should introduce tax rebate incentives ...

  22. Malaysian Tourism Tax System (MyTTx)

    Malaysian Tourism Tax System (MyTTx) Royal Malaysian Customs Department. Bulletin Board. Latest Announcements. See more [28/02/2024] Notice of Scheduled Downtime for Major Server Firmware Upgrade Phase 2 [ 09/03/2024, 12:00AM - 02:00AM ] ... Please refer to Tourism Tax Policy No.2/2023 for further details.

  23. Income tax exemption on medical tourism

    The Income Tax (Exemption) (No. 2) Order 2020 [P.U. (A) 141] was gazetted on 5 May 2020 to legislate the above-mentioned proposals. The Order provides an income tax exemption on the statutory income derived from a qualifying project carried on by a qualifying company. The amount of tax exempted shall be equal to the amount of qualifying capital ...

  24. Creating a high quality aged care industry

    The study of gerontology, the science of aging and elderly care, plays a crucial role in the realm of medical tourism and the flourishing health and wellness industry. Malaysia stands out as a top destination, particularly in Penang, known for its advanced medical facilities and expertise in geriatric care.