Posted on December 28, 2010, Tuesday
SIBU: Sibu is expected to have smaller budget hotels beginning 2011 when hoteliers decide to downsize their business to avoid increasing service tax and thereby avoid losing their business.
Chairman of Sarawak Central Region Hotel Association chairman Johnny Wong Sie Lee told the Borneo Post yesterday, this was the decision of many budget hoteliers for the sake of their customers.
He said they had received the order from the Customs and Excise Department about the hike in the service tax.
For hotels with 26 rooms or more, he said service tax would be hiked from five to six per cent. For hotels with 25 rooms or less, he said the service tax would remain at five per cent.
“Owners of budget hotels are already facing tough times in the service industry. Many have already downsized their business to cut down cost.”
With the increasing service tax, he said more hoteliers had indicated downsizing their business.
“What is the point of having bigger hotels when you have fewer customers walking in, as more will be checking into the smaller hotels?” he asked.
Wong said the number of hotels with 25 rooms or less had already increased to more than 30 in Sibu.
“With the hike in service tax, there will definitely be more budget hotels,” he stated.
In that way, he said the hoteliers would be smiling and the customers would be smiling too.
He said some budget hotels in Sibu were charging customers RM50 or more per night. For some, their room rates were cheaper than RM50, he said.
Meanwhile, Wong called on hotels affected by the increasing service tax to hike their room rates accordingly in their panel quotation for government servants. He said the Resident Office had asked for the quotation recently, and they had submitted it.
“That was when we had not received the order on the hiked service tax.”
He said his association had written to the State Secretary to inform him of the increasing room rates due to the hiked sales tax.
“Now, association members affected by the hike must add one per cent to their room rates for the civil servants and the State Secretary must be given the new panel quotation.”
Notes: Well I don't whether it's also applies to Miri or not but it should as it is "Malaysia in whole", I had called up the local authorities to inquries regarding about this:
Royal Malaysian Customs Department (Miri Branch): They're awared that such rumors are spreading in Miri which the newspaper article was mentioning Sibu. However at the moment they cannot confirm anything to such rumors as currently they still awaiting for an official writing from the headquarters.
