Levy on hotels in Penang postponed

Levy on hotels in Penang postponed
Penang’s new Chief Minister Lim Guan Eng (centre) seated with his deputies Mohammad Fairus Khairuddin (left) and P. Ramasamy. Standing behind (from left) are state executive committee members Law Heng Kiang, Phee Boon Poh, Law Choo Kiang, Chow Kon Yeow, Lim Hock Seng, Wong Hon Wai, Ong Kok Fooi and Abdul Malik Abul Kassim.

GEORGE TOWN - The imposition of tax on hotel rooms in Penang has been postponed to after March.

State Local Government and Traffic Management Committee chairman Chow Kon Yeow has agreed to the Malaysia Association of Hotels Penang Chapter's request to defer the implementation date.

"We are now fine tuning the mechanism on how to implement the levy and we will announce later when the levy will be enforced," he said. "The levy move has been accepted by hoteliers and it will be imposed next year."

The state had earlier planned to collect taxes at between RM1 and RM5 per room per night from March.

He said local councils would assist the state government in imposing the hotel levy and collecting the tax.

"Under Section 107 (1) of the Local Government Act, a local authority in the granting of any licence or permit may prescribe the fees for such licence or permit and the charges for the inspection or supervision of any trade, occupation or premises in respect of which the licence is granted.

"So, the Penang Municipal Council (MPPP) and Seberang Prai Municipal Council (MPSP) have the authority to collect the levy.

"MPPP and MPSP are awaiting instructions from the state.

"Once we get the confirmation, the local authorities will write to hoteliers to inform them about the policy," he said before a walkabout session to distribute calendars in Lebuh Campbell yesterday.

Chow said Penang has 72 star-rated hotels and 100 non-rated lodgings with about 14,700 rooms.

"The state expects to receive a few million ringgit from the levy," he said, adding that Malacca imposed a similar levy in the state in 2011.

Separately, Chow said local councils would look into illegal lodging issues and take action to legalise them.

"We knew that some illegal lodgings do not comply with the planning requirement or Fire and Rescue Department's law.

We are taking active measures to help them to solve illegal lodging issues in the state," he said.

The state's plan to impose hotel levy was announced when Chief Minister Lim Guan Eng presented the state budget for 2014 at the state assembly meeting in November.

Lim said the levy was to help the state's tourism industry and money collected will go into a special fund, which will be used for tourism, culture, heritage and art.

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