Open borders gradually to Asean countries in Q1 2021 so tourism sector remains sustainable, MATTA urges Putrajaya

KUALA LUMPUR, Oct 29 — The gradual reopening of the country’s international borders to its Asean neighbours in the first quarter of 2021 would help to sustain the tourism industry given the limitations of domestic tourism, the Malaysian Association of Tour and Travel Agents (MATTA) said today.

MATTA president Datuk Tan Kok Liang said a timely and responsible easing of travel restrictions will shore up the livelihoods of the 3.6 million Malaysians involved in the tourism industry.

“In 2019, Malaysia received 26.1 million foreign tourists with a revenue of RM89.4 billion exceeding the exports of palm oil at RM70 billion and rubber gloves at RM22 billion.

“Inbound tourism is one of our most lucrative exports and with restrictions on travel in place, these exports and foreign revenues have disappeared, affecting the tourism sub sectors value chain especially SMEs.

“Tourism exports have a much higher impact on the domestic economy than overall exports. For every dollar of tourism exports, 89 cents of domestic value-add is generated,” he said in a statement here.

Touching on the upcoming Budget 2021, Tan also called upon the government to act boldly and decisively to bolster a floundering Malaysian tourism industry during this period of economic adversity.

As part of MATTA’s Budget wishlist, Tan wants the government to consider tax relief for businesses and individuals so that more money can be spent within the economy through consumer spending.

“The tourism industry is fragile and sensitive for 2021 and likely beyond because of the critical impact caused by the Covid-19 pandemic.

“This National Budget must provide solid relief programmes and substantial spending to stimulate the economy and livelihood of the people,” he said, adding that said Budget must be reviewed periodically given the unprecedented global changes currently taking place.

Amongst other relief support, Tan proposed that the government introduce a more effective wage subsidy programme and loan moratorium extension until June 2021.

On the moratorium, Tan pointed out how the already crippled tourism industry was unable to service their bank loan repayments with businesses and individuals facing a possibility of bankruptcy.

“The current measures rolled out to provide temporary relief such as the Penjana Tourism Financing (PTF) and related facilities are not effective as prudent small and medium-sized enterprises are cautious on future repayments during this period of uncertainty,” he said.

As for a more effective wage subsidy programme, Tan said MATTA was in agreement with the Malaysian Association of Hotels (MAH) on a proposed two-tiered wage subsidy system which is similar to the system used in other Commonwealth countries.

The proposed system stipulates a 50 per cent wage subsidy for employees with monthly pay of up to RM4,000 and 30 per cent for those earning between RM4,000 and RM8,000.

Explaining the relief, Tan said the government could provide double tax deductions for all costs for employees’ local company trips and reliefs to companies willing to send their employees to local MICE (Meetings, Incentives, Conventions, Exhibitions) events.

“Other reliefs proposed include granting 100 per cent exemption for import and excise duty, allowing the importing of completely build up coaches and higher-end tourism vehicles, extending tax incentives granted for inbound and domestic tour companies to 2023, extending the Human Resources Development Fund levy exemption to December and a bigger budget for upgrading tourism infrastructure; working capital for promotions and marketing (matching grant) and business adjustment post Covid-19,” he said.

He also called upon Putrajaya for a special grant of RM20 million allocated to tourism businesses to invest in digitalisation and for the government to support local online platforms instead of relying on foreign platforms in the upcoming Budget 2021 session.

“At this unprecedented time, the government should manage its finances wisely and there should be solid relief programmes and funding to meet the real needs and priorities that benefit the rakyat and the economy as a whole.

“We look forward to the commitment the government can offer for the tourism industry so that the industry can have access to better opportunities in 2021”, he concluded.

The Dewan Rakyat is set to reconvene on November 2 with the meeting to be held until December 15, while Budget 2021 — which sets out the government’s planned spending for the next year — is scheduled to be tabled on November 6.