Kuala lumpur: The special individual income tax relief of up to RM1,000, as announced under Budget 2026, is part of the government's efforts to encourage Malaysians to travel within the country in conjunction with Visit Malaysia 2026 (VM2026). Prime Minister Datuk Seri Anwar Ibrahim stated that this initiative aims to invigorate the domestic tourism sector while also stimulating local economic activity.
According to BERNAMA News Agency, the Prime Minister emphasized that the initiative could help rebalance the trend of outbound tourism, which has increased due to the strengthening of the ringgit. "Due to the strengthening of the ringgit, there are also side effects, as more Malaysians are travelling overseas to places like Thailand, Japan, and Indonesia. As such, we are introducing additional measures to boost domestic tourism by providing a tax exemption of up to RM1,000 for spending within the country," he said during the Minister's Question Time in the Dewan Rakyat.
Anwar was responding to a supplementary question from Jimmy Puah Wee Tse (PH-Tebrau) regarding the recent influx of nearly 200,000 Malaysians to Thailand and the subsequent expenditure of around RM50 million there. Despite the benefits of the initiative, Anwar, who also serves as the Finance Minister, expressed concerns over the high cost of domestic tourism, particularly with respect to accommodation and food at popular destinations like Langkawi.
The Prime Minister mentioned that discussions are ongoing between the Second Finance Minister and the Kedah Menteri Besar to address these cost issues. He highlighted that, while Langkawi's natural beauty stands out compared to places like Phuket, Thailand, its high costs remain a challenge that must be addressed.
Regarding VM2026 promotional efforts, Anwar noted that 70% of the campaign will be implemented digitally, with the remaining 30% following conventional methods. The Ministry of Tourism, Arts and Culture (MOTAC) has conducted engagement sessions with industry players, including airline companies, to increase flight frequency.
Additionally, Anwar reaffirmed the government's commitment to positioning Malaysia as a major Islamic tourism and economic hub, leveraging the country's strengths in syariah-compliant finance and tourism. "Six Islamic countries have proposed that Malaysia take the lead in efforts to enhance Islamic financial programmes, instruments, and the economy, and integrate them with tourism," he said.
He further mentioned that several Islamic countries, such as Turkiye and Qatar, have implemented Islamic tourism programmes to attract more tourists, and he encouraged MOTAC to prioritize the development of Muslim-friendly tourism programmes.