KUALA LUMPUR — The Malaysian Association of Tour and Travel Agents (MATTA) is seeking clarification from the Customs Department on whether or not Goods and Services Tax (GST) should be imposed for tickets already purchased for travel dates on or after June 1. According to a Borneo Post report, MATTA president Datuk Tan Kok Liang said an explanation is direly needed, seeing as how tour and travel products are sold everyday to a huge number of both inbound and outbound tourists.“For instance, a tour package sold today with the prevailing GST is six per cent, but the travel date is in June, what should be the GST rate for a such tour? Clarity is needed as soon as possible.“We hope the department will decide quickly on the transitional issues when GST is zero-rated soon,” he reportedly said.
His concern arose following a Finance Ministry announcement on Wednesday that GST will be zero-rated for all items and services from June 1. The association said it welcomed the move as it would potentially increase the price appeal of Malaysia as a travel destination and encourage more tourist spending.“This indirectly grants a ‘discount’ to the price of local tour and travel packages, with hopes of boosting the domestic travel industry which is an important contributor to the economy.“The zero-GST system is bound to promote spending by both locals and tourists, especially on shopping, food and beverageand tourist attractions,” he said.He also said that the move would bode well for domestic tourism as it will cause a drop in flight tickets between Peninsular and East Malaysia.“From day one, air travel should be zerorated as it is not a luxury but an essential service for travel between Peninsular and East Malaysia.“This policy shift will also bring consistency in GST treatment between Designated Areas (DA) Labuan, Langkawi and Tioman (where supplies of goods made by any person within or between DA are not subject to GST) and the rest of Malaysian travel locations,” he added.