Hotels in Malaysia report loss of RM40m in revenue due to Wuhan virus

Hotels in Malaysia report loss of RM40m in revenue due to Wuhan virus
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KUALA LUMPUR (Feb 10): Hotels in Malaysia reported a total of 95,972 room cancellations due to the fast-spreading 2019 novel coronavirus (2019-nCoV), resulting in a loss of revenue of over RM40 million as of last Saturday (Feb 8).

This was revealed by the Malaysian Association of Hotels (MAH) in a statement today, which highlighted it has met with relevant ministries in preparation of a government stimulus package for the tourism industry.

MAH president Kamaruddin Baharin said most of the room cancellations are up until the end of this month, with the majority originating from China.

“There are also cancellations from local Malaysians, from Hong Kong, Singapore, Taiwan, Vietnam, South Korea and other countries.

“We are tracking cancellations from our member hotels and the number is growing everyday... People are afraid to travel and that is a problem, despite the situation in Malaysia being well under control and we remain safe for tourism,” he said.

According to data provided by MAH, hotels in Kuala Lumpur and Sabah took the biggest blow, with losses of revenue due to cancellations for the period Jan 22 to Feb 29 amounting to RM11.29 million and RM10.48 million respectively.

MAH said it has met with Finance Minister Lim Guan Eng and Tourism, Arts and Culture Minister Datuk Mohamaddin Ketapi, as well as key industry stakeholders, in a meeting called by the finance ministry in preparation of the government stimulus package for the tourism industry.

“We are happy that both the Minister of Finance, and the Minister of Tourism were receptive to our ideas, particularly on easing industry stakeholders’ cash flow constraints.

“The ministers openly expressed willingness to consider the temporary suspension of certain mandatory contributions by tourism employers, as well as to introduce a personal tax relief for individual Malaysians traveling within the country in 2020,” said MAH chief executive officer Yap Lip Seng.

Yap said the industry is also seeking a reduction in the rate of the tourism tax from RM10 to RM1 per room per night until the end of this year, to boost international tourist arrivals.

To encourage locals to travel and stay in hotels, MAH called for a personal income tax relief of up to RM1,000 per person for those staying in hotels registered with the tourism ministry.

The association also proposed a temporary exemption of service tax for hotels, as part of the Visit Malaysia Year’s initiative to counter the negative impact of the coronavirus.

It is also asking for a 10% discount on water bills for six months, a temporary suspension on employers' contribution to EPF and the minimum wage order, amongst others.

Furthermore, MAH said the industry could benefit from special set ups including a tourism marketing fund, recovery campaign and relief guarantee facility, and general banking support.