Budget 2027: Hoteliers want minimum wage revision to be localised

The Malaysian Association of Hotels (MAH) has proposed that the minimum wage revision in the national fiscal Budget 2027 be localized, dividing it into urban, semi-urban and rural districts. This is because hotels operating in various areas have different costing mechanisms, according to MAH vice-president Datuk Khoo Boo Lim. In urban areas such as city centres, costs increase more rapidly than in semi-urban and rural localities, he explained.

Khoo emphasized that the current proposal for a uniform minimum wage raise across the country would be burdensome. He stated that tailored wage rates tailored to local conditions are necessary to prevent mismatches and rising operating costs for small and medium enterprises (SMEs) in the hospitality sector.

He urged the Finance Ministry to conduct a thorough cost analysis of living cost factors before implementing the minimum wage increase. MAH also requested additional incentives such as reduced commercial electrical tariffs and water rates to offset rising operational expenses. The hotel industry, while operating, faces tight profit margins, said Khoo. Balancing profit and losses is a delicate tightrope walk for these establishments.

Penang Malaysian Association of Travel and Tour Agents (MATTA) chapter president Carolyn Leong echoed the MAH's sentiment, calling for additional incentives to boost travel and tourism activities. This is because the Visit Malaysia Year 2026 campaign is set to continue into the next year.