Gov’t plans to extend tourism tax exemption

The executive council is planning to regulate the tourism tax by regrouping hotel and restaurant establishments and extending the tourism tax exemption, the Secretary for Administration and Justice, André Cheong, announced on Friday.

The executive council is proposing that the current services provided by hotel establishments, restaurants, and karaoke bars redefine which goods and services incur the tourism tax, expressly contemplating “goods” within the scope of the tourism tax in order to more clearly define the incidence of the tax.

At the same time, in accordance with the tourism policy of the Macau Special Administrative Region (MSAR), in which the development of “low cost accommodation” is encouraged, the draft bill suggests the redefinition of the scope of exemption from the tourism tax, determining that goods and services provided by two-star hotels, low cost accommodation; simple dining establishments, kiosks of the restaurant areas; drinking establishments, and eating establishments be exempt from tourism tax.

Furthermore, the administration said that it follows from the Tourism Tax Regulation in force that the collection of the tourism tax constitutes revenue earmarked for the Tourism Fund. 

“In view of the development of Macau’s tourism industry, the draft legislation stipulates that the collection of tourism tax shall be paid directly to the Macau SAR Treasury, and the disposal and allocation of the funds shall be carried out by the Macau SAR Finance Services.” the government added. 

Last year, amid the Covid-19 pandemic, the government launched measures to introduce reductions and exemptions from a range of taxes and extend the coverage of the tourism tax exemption, which is expected to benefit over 370 tourism service establishments and cost about 379 million patacas in the budget. JW