600 cinema halls await upgrades as industry seeks tax cuts

PETALING JAYA: A coalition of 122 business groups has renewed calls for the federal and state governments to abolish the Entertainment Duty Act 1953, arguing the decades-old law no longer reflects the needs of Malaysia’s entertainment, tourism and creative industries.

Industries Unite said today abolishing the Act and removing entertainment duty would help their businesses grow.

Koh Mei Lee, the chairman of the Malaysian Association of Film Exhibitors, a member of Industries Unite, said more than 600 cinema screens nationwide had not undergone major refurbishment in over a decade.

“If the entertainment tax is removed or reduced, we will prioritise refurbishing and renovating these cinemas to ensure the industry’s long-term sustainability.

“In order for us to have healthy cinemas, we need to refurbish because you need to give reasons for people to go back to the cinema,” she told a press conference called by Industries Unite here.

Koh said cinemas are still recovering from the Covid-19 pandemic closures that left many operators burdened with loans, on top of pressure from changing viewing habits, shorter cinema release windows and competition from streaming services.

“Nowadays, people go to the cinemas only for big blockbuster movies. If it is just an average movie or comedy, they don’t go because it is more convenient to watch at home,” she said.

The Entertainment Duty Act 1953 governs duty on admissions to entertainment, including exhibitions, performances, amusement, games, sports, and other activities that may be declared entertainment by the finance minister.

The rate is generally 25% of the admission fee for entertainment places or events.

Malaysian Association for Arts, Live Events, Concerts and Festivals senior adviser Rizal Kamal called for a uniform entertainment duty policy nationwide.

He said event organisers currently faced different tax rates, approval processes and interpretations depending on the state where events were held.

“We want certainty. We want stable, long-term policy that creates confidence. Confidence attracts investments. Investments create more events, more tourism, stronger local businesses and definitely vibrant cities across Malaysia,” he said.

Rizal said inconsistent policies made it harder for organisers to plan concerts and invest in the live entertainment sector.

He lamented that concerts featuring local performers could be pushed into a higher international-entertainment duty bracket if even one foreign act was included on the bill.

“So the local artist can’t even have an international performer open for them because the tax would just go up to 10%. Ultimately, the local artist loses out,” he said.