KUALA LUMPUR (June 9): The new Tourism Tax, which is slated to be enforced as scheduled on July 1, is unlikely to affect inbound tourism, said a local investment bank.

“We opine that the rates are not excessive and can easily be borne by domestic and foreign guests,” wrote Maybank IB Research analysts Wong Chew Hann and Yin Shao Yang in a report yesterday.

The tax will see rates of between RM2.50 and RM20 charged for a night’s stay.

Meanwhile, the arrivals of tourists from China are expected to pick up after the Chinese National Tourism Administration encouraged more Chinese tours to Malaysia and the Malaysian Immigration Department’s planned opening of a visa processing centre in Xiamen this year.

“We opine that the (tax’s) impact on tourism receipts from Chinese (visitors) will be modest, as transaction limits are unchanged,” the report as the State Administration of Foreign Exchange announced it will monitor overseas bank card transactions of under 1,000 yuan, effective Sept 1, 2017.

First quarter visitor arrivals from China of 551,000 accounted for only 18% of the 3 million target for the full year, the report noted.

Although first quarter total visitor arrivals saw more arrivals from China, Thailand and Brunei offset by fewer arrivals from Singapore, Indonesia, South Korea, India and Japan, Wong and Yin said growth should resume, going forward, on the back of ongoing promotional efforts and lined up tourist-friendly events.

“The two big caps with direct exposure to our tourism thematic — Genting Malaysia Bhd and Malaysia Airport Holdings Bhd — have played out well. We now prefer Genting Bhd for its more attractive valuations.

“AirAsia Bhd remains a ‘buy’ due to its still attractive valuations, while Atlan Holdings Bhd is a beneficiary of more visitor arrivals from Thailand,” the report said.

The 29th SEA Games to be held in Kuala Lumpur between Aug 19-30, 2017, the 60th National Day celebrations on Aug 31, 2017, as well as the 9th ASEAN Para Games between Sept 17-23, 2017 are expected to be tourist-friendly events in Malaysia.

Elsewhere, the Malaysian immigration department will also waive visa requirement for Indian nationals residing outside India, while Tourism Malaysia will set up an office in Kolkata, the analysts said.