THE controversial tourism tax will be deferred until August 1, Tourism and Culture Minister Nazri Abdul Aziz said today.

“That’s right,” Nazri told The Malaysian Insight in a short message, confirming reports that the tax will be postponed as it is not ready to be implemented yet.

Nazri also said the tax, which was to be enforced on July 1, will only affect foreigners staying in all types of hotels while Malaysians staying in hotels that are rated three-star or below will be exempt.

The Padang Rengas MP said the tax would be divided into four categories – charges for five-star hotels would be RM20, RM10 for four stars, RM5 for three stars, and RM2.50 for two stars and below.

When asked if the taxes will be diverted to the respective states where they were collected, Nazri said “for that you’ll have to ask Customs (Royal Malaysian Customs)”, adding that the agency was in charge of the tax.

The tax draw widespread criticism from east Malaysia, especially from Sarawak, which withdrew its representative from the Malaysian Tourism Board earlier in June.

It also started a spat between Nazri and and Sarawak Tourism Minister Abdul Karim Rahman Hamzah, which later grew to involve Minister in Prime Minister’s Department Abdul Rahman Dahlan.

Last Sunday, Sarawak Chief Minister Abang Johari Openg reiterated that the state would not enforce the tax on July 1 as discussions are still ongoing, which included the question if hotels need to amend their contracts with customers who made earlier reservations. – June 27, 2017.