Tourism Tax on Digital Platform Service Provider

The Tourism Tax (Amendment) Act 2021 has finally been gazetted on 2 February 2021 with no changes from the Tourism Tax (Amendment) Bill 2020. The effective date for charging and levying the Tourism Tax is also set as 1 July 2021 based on the Appointment of Effective Date for Charging and Levying of Tourism Tax. For existing digital platform service provider, the date of coming into operation for the registration section, i.e. Section 20C(3) of Part VA of the Tourism Tax Act 2017, is 1 April 2021.

In addition, the following Orders in respect of Tourism Tax have been published in the Federal Gazette Portal on 16 March 2021.

  • Tourism Tax (Rate of Digital Platform Service Provider Tax) Order 2021 - RM10 per room per night
  • Tourism Tax (Digital Platform Service Provider) (Exemption) Order 2021 - A tourist who is a Malaysian citizen and a tourist who is a permanent resident of Malaysia

These Orders come into operation on 1 July 2021. Please click on the above header link for copies at the Federal Gazette Portal of the Attorney General's Chambers and our earlier Tax Whiz on the Tourism Tax (Amendment) Bill 2020.

With less than 4 months until the effective date of 1 July 2021, it is crucial for the digital platform service providers as well as accommodation operators to have already started looking into the provisions of this tax and the impact on their systems and operations. Where there are areas which are ambiguous or unclear, discussions with the Authorities should be undertaken. We understand that the registration portal has yet to be released by the Authorities. The digital platform service providers should keep a look out for the registration portal to initiate the registration as soon as possible.

Our highlights are intended to provide a general overview of the key proposed tax changes and should not be used or relied upon as a substitute for detailed advice or as a basis for formulating business decisions.

Should you have any questions or require further clarification, please do not hesitate to email or contact any of our Executive Directors, Directors, Associate Directors or Managers whom you are accustomed to dealing with or who are responsible for the tax affairs of your organization. 

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

Ng Sue Lynn
Executive Director
Indirect Tax Practice

Dato' Tan Sim Kiat
Indirect Tax Practice

Cheah Wai Ling
Indirect Tax Practice