According to statements made by Deputy Finance Minister Steven Sim Chee Keong today, the country’s tourist industry would not be negatively impacted by the luxury goods tax that is now undergoing adjustments.
According to him, travelers in Malaysia are not interested in buying for luxury products but rather come to explore attractive tourist spots and national heritage sites as well as buy local handicrafts.
“In addition to this, they are exempt from paying taxes on any purchases they make of Malaysian handicrafts. If we see it from this angle, we are, in effect, luring an increased number of people to the event “he said to the journalists gathered around him in the foyer of the Parliament building.
His remarks were in response to the appeal made by the previous prime minister, Ismail Sabri Yaakob, urging the government to reconsider the implementation of the luxury goods tax since it would discourage visitors from shopping in Malaysia.
According to Sim, the purpose of the tax was to broaden the country’s ability to collect tax income and to establish a taxation structure that was more progressive, all without causing the industry to suffer.
According to what he had said, “We are consulting with all stakeholders including the retail and tourist industries to determine how the impact may be mitigated.”
Sim also stated that the tax does not apply to food or other necessities like mobile phones and only applies to products that are considered to be luxury goods.
Prime Minister Anwar Ibrahim suggested the establishment of a luxury goods tax starting this year with a particular value limited to the type of products, including watches and designer items, which he said would raise national income in the new budget for 2023. The tax would take effect in 2023.