We did not cede, we bargained, says Abang Jo on tourism tax

Chief Minister Abang Johari Openg (centre) and wife welcoming guests and well-wishers to their raya open house at the Borneo Convention Centre in Kuching. - dayakdaily.com

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KUCHING: Chief Minister Datuk Amar Abang Johari Tun Openg denied Sarawak had cede in its row with Putrajaya over the controversial tourism tax.

He said the state only agreed to the controversial tax after wringing out a compromise.

Abang Johari said one of the compromises it had successfully sought was that the tax collected would only be shared equally among the three territories that make up the Federation of Malaysia – Sarawak, Sabah and the federated states of Malaya.

“Tax and the collection of taxes is a federal matter under the (Federal) Constitution. But tourism is a state matter,” he told reporters at his Raya open house at Borneo Convention Centre in Kuching.

Sarawak was irked when the tourism ministry pushed the tourism tax to parliament without properly consulting the state.

The chief minister said when he met Prime Minister Datuk Seri Najib Razak on June 14 in Putrajaya, “I brought up the issue of residual powers and conflicts with state rights”.

He said it was at that meeting that the compromise was thrashed out.

Another of the state’s demand sought and reached was that its share of the tax money would have to be channeled directly to the state government and “not through any federal agencies”.

“We will continue to defend state rights,” Abang Johari said.

He said the conflicts, as shown in the dispute over the tourism tax, had triggered an “in-depth talks” to be opened with Putrajaya to avoid repeats such conflicts.

The conflict had also triggered a highly publicised row between Sarawak Tourism Minister Datuk Abdul Karim Hamzah and federal Tourism Minister Datuk Seri Nazri Aziz.

Nazri had reacted angrily when Karim appealed to the federal government for a deferment on the implementation of the tax to first discuss Putrajaya’s infringement of state’s right.

Nazri in calling Karim a political green horn and a “gangster” who should just shut up raised the ire of Sarawakians, including Nazri’s cabinet colleagues, who branded him as “uncouth” and “rude”.

When Sarawak agreed to the tax, state DAP chairman Chong Chieng Jen said the state government had given in to Umno.

Chong said by “giving in to Umno” it had made the people of Sarawak “the biggest losers”.

The Kota Sentosa assemblyman said the people of Sarawak are now subjected to double taxation – by having to pay GST for the hotel services and now the tourism tax.

Abang Johari said the tourism tax will not be implemented on July 1 in Sarawak as “discussions on the tax is not over”.

He said it would only be implemented when all the issues raised have been solved.

“Its not yet finalised. Only the methodology is finalised.

“There are other issues that needed to be ironed out.”

One of them is the issue on “forward (advance) bookings”.

He said if the tourism tax is imposed on those bookings when the tax was not in force, it could create disputes as it would infringe the contract between the hoteliers and those who had booked in advance.

Abang Johari also said Sarawak will work with Sabah for a common stand to iron out the kinks of the tax. – dayakdaily.com