PETALING JAYA: With Visit Malaysia Year 2026 on the horizon, long-term initiatives should be implemented for the hotel industry, especially for small operators and including small and medium enterprises (SMEs) related to tourism, says the Malaysia Budget and Business Hotel Association (MyBHA).

In its recommendations for the hotel industry in Budget 2025, MyBHA president Dr Sri Ganesh Michiel said allocations should be made for the hospitality sector for an expected surge in tourism in the coming years.

He also urged for more support for small operators, particularly those in smaller cities and districts.

These operators are vital to the tourism ecosystem, offering unique experiences that enrich Malaysia’s cultural tapestry, he added.

MyBHA also called for regulations on short-term rental accommodations (STRA) to ensure they comply with the existing rules on registration, licensing, safety, hygiene and taxation as hotels.

“The unregulated growth of STRA has created an uneven playing field, posing significant threats to the hospitality industry,” said Sri Ganesh.

Online travel agencies should also be regulated over unfair practices that can disadvantage hotel operators, he added.

MyBHA called for an increase to the service tax (SST) threshold from the current RM500,000 to RM1.5mil.

“This adjustment will alleviate financial pressures on smaller operators,” he said.

Another issue would be music royalties for the hospitality sector – Ganesh said the complexities surrounding licensing and high fees have made it challenging for hotels to provide entertainment.

“The government should simplify it by establishing a single collective management organisation to consolidate royalty collection into one agency.

“This approach would enable hotels to comply more easily with regulations and offer quality entertainment without incurring prohibitive costs,” he said.

MyBHA also called for an allocation for sustainable tourism practices to preserve Malaysia’s natural and cultural resources, which are key attractions for tourists, said Ganesh.

He also asked that the Tourism, Arts and Culture Ministry appoint experienced officers who do not only possess extensive knowledge of the hospitality industry, but also are able to maintain a strong relationship with industry stakeholders.

“Such leadership is crucial for fostering collaboration, understanding industry needs and implementing strategies that will benefit the sector,” he added.

https://www.thestar.com.my/news/nation/2024/10/14/budget-2025-should-help-boost-small-players-say-hoteliers