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MyBHA Supports Lower KWSP Contribution, Calls for Stricter Action Against STRA

By: Rosli Mansor Ahmad Razali

IPOH—The Malaysian Budget and Business Hotel Association (MyBHA) has welcomed the government’s decision to reduce the Employees Provident Fund (KWSP) contribution rate for foreign workers to 2%.

MyBHA President, Dr Sri Ganesh Michiel, described the decision as a positive step in assisting the hospitality sector amid rising operational costs.

“However, the government must ensure that this policy does not unfairly benefit Short-Term Rental Accommodation (STRA) providers, who frequently employ foreign workers without complying with labour regulations.

“Their actions create an uneven playing field for licensed hotel operators who adhere to the law.

“Many STRA operators do not pay taxes, fail to comply with safety standards and employ undocumented foreign workers.

“This allows them to offer lower rates than licensed hotels, which negatively impacts industry competitiveness and national revenue,” he said.

In response, MyBHA urges the government to take firm action, including strengthening law enforcement against STRA operators, utilising digital technology to monitor illegal operations, and enhancing collaboration between relevant agencies to curb non-compliance.

Additionally, MyBHA suggests launching public awareness campaigns to educate consumers on the implications of using unlicensed accommodations.

“MyBHA remains committed to working closely with the government to ensure the hospitality industry grows sustainably and fairly.

“We hope the STRA issue will be addressed promptly for the benefit of the sector and the national economy as a whole,” he stressed.

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