KUALA LUMPUR: Major local retail associations have joined forces to urge the government to reconsider and withdraw a proposal to introduce a luxury tax.
The introduction of a luxury tax could make Malaysia’s pricing uncompetitive and discourage tourist arrivals, according to a joint media statement released today.
In addition, Malaysians are enticed to shop abroad and Malaysians who shop abroad take money out of the country, they said.
“This is a lose-lose situation – the loss of foreign tourist arrivals and the loss of Malaysians shopping locally, coupled with the loss of foreign exchange.
“Even if a mechanism could be devised for foreign tourists to reclaim such luxury taxes, Malaysians would still be enticed to do their shopping abroad.”
The statement was issued by Malaysia Shopping Malls Association, BBKLCC Tourism Association Kuala Lumpur, Batu Road Retailers Association, Bumiputra Retailers Organization, Federation of Malaysia Business Associations, Industries Unite, Malaysia Retailers Association and Malaysia Retail Chain Association.
They said that if the economic philosophy is to tax the rich, only flashy big-ticket products should be appropriate to meet the criterion (of the luxury tax).
“Big-ticket items such as sports cars, racing bikes, yachts and airplanes can be considered,” they said, adding that a holistic approach should be taken that balances risk and reward and the flow-through multiplier effect of Creates business activities that contribute to the nation’s economic growth.
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim proposed in the 2023 Budget to introduce a luxury goods tax from this year, with a certain value limited to the type of goods, including watches and fashion items, to boost government revenue. -Bernama
https://www.thesundaily.my/local/rethink-luxury-tax-proposal-urge-retail-associations-NG10709657 Reconsider luxury tax proposal, retail associations urge