Distribute RM1 bln tourism financing fairly - MATTA

KOTA KINABALU: The Malaysian Association of Tour and Travel Agents (MATTA) welcomes the various initiatives under the National Economic Recovery Plan (Penjana) which were announced by Prime Minister Tan Sri Muhyiddin Yassin on Friday. The plan puts into focus recovery supports which are also extended towards tourism SMEs.

MATTA president Datuk Tan Kok Liang said: "The RM1 Billion Penjana Tourism Financing (PTF) facility which will be made available to finance transformation initiatives
by SMEs in the tourism industry is one of the good initiatives. "

"We seek details on the mechanism of the PTF facility where we are looking at extremely low interest rates or interest free loans for digitalisation under the new norm where most procedures and sales are contactless, and are also done extensively through e-marketing platforms.

"Also, in order to remain competitive, investment in health and safety protocols is necessary to boost travellers' confidence and simultaneously safeguard both employees and tourists.

"However, to date, under the Special Relief Facility (SRF) fund , we wer e given to understand there has been no drawdown yet for the tourism players under the previous Economic Stimulus Package.

"Members have also complained that they were either disqualified for the fund or the allocation had been fully used up. We hope that the government will monitor and
supervise this funding facility to ensure fairness to all," Tan said.

"The tourism tax and service tax exemption for accommodation services extended to June 30, 2021 are also welcomed to boost travel demand.

"It may not pose any positive effect due to weak demand in the next six months, but we anticipate it will help spur travel interests for 2021 especially when regional and international borders open up.

"Additionally, the extension of the period for income tax relief of RM1,000 for tourism expenses is a good move to rejuvenate the local tourism industry, but the conditions should include spouse and children.

"The eligibility should also be limited to tour packages bought from licensed travel agents and tour operators which include hotels, tours and transfers to ensure effectiveness," he said.

"On the extension period for deferment of tax instalment for tourism industry, it would be more helpful if taxes made payable for year of assessment 2019 are being set off against current period losses and for year of assessment 2020, what is there to defer since tourism companies are in a tax loss position?"

"As tourism companies are in a tax loss position, they will also not be able to enjoy tax relief or incentives for Covid-19 testing and purchase of PPE and thermal scanners, and
renovation of business premises.

"Government grants or subsidies would be more appropriate under these circumstances. "

"Finally, the extension of the Wage Subsidy Programme by three months needs to be reviewed again as the tourism industry will only recover by the end of the year. Likewise , we hope that the government will continue with the staff retention programme .

"We are thankful for the support from the Government; however, we hope that the Government would address more pertinent issues to prevent the aviation , hospitality
and travel industry being further decimated under the current scenario.

"More importantly, the government should also swiftly determine a timeline to begin tourism activities including tentative dates on the easing of borders," concluded Tan.