This article first appeared in The Edge Financial Daily on February 11, 2020

KUALA LUMPUR: Hotels in Malaysia reported a total of 95,972 room cancellations due to the fast-spreading Wuhan virus, resulting in a loss of revenue of over RM40 million as of last Saturday.

This was revealed by the Malaysian Association of Hotels (MAH) in a statement yesterday, highlighting that the association 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 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 in a statement.

The 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 travelling 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, the 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 2020’s initiative to counter the negative impact of the Wuhan virus.

The MAH, established in 1974, is the national network for the hotel industry of Malaysia, and has over 900 members.