MATFA Calls For Urgent Reforms Of Outdated Entertainment Tax Act 1953

KUALA LUMPUR, Sept 11 (Bernama) -- The Malaysian Association of Theme Parks & Family Attractions (MATFA) has called for urgent reforms of the outdated Entertainment Tax Act 1953, which currently imposes a 25 per cent tax on entertainment activities.

MATFA secretariat in a statement today, the association said it strongly supported the recent call made by the Sultan of Pahang Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah to develop and encourage new investments into tourism assets, which include shopping malls, hotels and restaurants to boost the economy.

Hence, it said a crucial step towards this goal is the removal of the outdated Entertainment Tax Act, which places undue financial strain on the family entertainment sector.

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“MATFA urges the government to reform this outdated tax system to foster tourism growth and enhance Malaysia’s global competitiveness,” it said.

The statement said that Malaysia’s family entertainment sector is a vital contributor to the nation's tourism industry, which, in 2019, generated RM 86.1 billion in revenue, contributing over 15.9 per cent to the national Gross Domestic Product (GDP).

“The theme park industry alone attracted eight million visitors in 2019, with large investments in major attractions such as Genting SkyWorlds, Sunway Lagoon, and Legoland Malaysia. These investments have created significant employment opportunities and boosted local economies.

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“However, the high entertainment tax discourages further investment in family attractions.

“If Malaysia does not adjust its approach, we risk falling behind regional competitors who have already modernised their taxation policies to encourage investment in family entertainment. This is a sector with immense potential to draw tourists, stimulate spending, and create jobs,” the statement read.

While calling on the government to see the bigger picture of tourism-led economic growth, MATFA said a modernised tax system would allow Malaysia to harness the potential of this high-growth industry, creating new opportunities for investment, job creation, and community development.

“This step is critical to enhancing Malaysia’s global competitiveness in the tourism sector and ensuring sustainable economic benefits for the country,” it added.

-- BERNAMA