The Macao SAR Government has ended its consideration of introducing a tourist tax after a comprehensive assessment of the findings of the Feasibility Study on Tourist Tax Imposition, the characteristics of Macao’s tourism industry and the latest developments in the sector.
Visitor arrivals in Macao have plunged in recent months, causing varied impacts on the tourism-related industries. It has become a priority at this stage for the Macao SAR Government to bolster recovery of the trade.
The Macao Government Tourism Office (MGTO) completed the Feasibility Study on Tourist Tax Imposition last year. The findings revealed a divergence of opinions among stakeholders. The study also referenced 11 improvement strategies proposed by the World Tourism Organization to cope with overtourism. The research revealed that many cities opt for the strategies of “promoting the dispersal of visitors within the city and beyond” and “improving urban infrastructure and facilities”, to cope with overtourism.
In considering Macao’s goal to move towards more sustainable tourism development, the study indicated that “regulating increase in visitor numbers by levying tourist tax may not be the most effective measure applicable to Macao”.
In addition, events in Hong Kong turned the rising tide of visitors to Macao in 2019. Monthly visitor arrivals in Macao last year experienced a gradual downfall in terms of year-on-year change. In contrast with the year-on-year double-digit rise over the first seven months of last year, visitor arrivals had dwindled to a double-digit, year-on-year decline rate by the end of the year.
Since the beginning of the COVID-19 pandemic this year, visitor arrivals have dropped even further, by more than 99 percent, from 2.85 million in January down to only 16,133 in May.
The declines in arrivals were a significant blow to the tourism industry, that affected all related sectors including the hotel, catering and retail industries. The changing environment reflects the vulnerability of tourism to external factors. When an emergency or unforeseen situation emerges, the travel trade is often first to experience the impact, followed swiftly by the industries linked to it.
Tourism plays a pivotal role in the economy of Macao, and how the tourism industry goes about developing sustainably influences the prospects of other parts of the economy. The Macao SAR Government is striving to bolster a recovery of the tourism trade by taking measures such as cutting taxes and offering other support, while avoiding measures that might adversely affect the tourism trade.