Calls to restore Langkawi’s full duty-free status have gained momentum following a proposal by the Sultan of Kedah, prompting the federal government to consider reinstating the island’s tax-free privileges to boost its tourism sector.
Prime minister Anwar Ibrahim recently announced that proposals to review and potentially restore Langkawi’s full duty-free status are being studied.
“I have asked finance minister II, Amir Hamzah Azizan, to look into it,” he said, as reported by The Star, adding that the government is also exploring broader efforts to restore the island’s competitiveness.
The move follows calls by the Sultan of Kedah, Al-Aminul Karim Sultan Sallehuddin Sultan Badlishah, to reinstate full duty-free privileges, which had been partially scaled back in recent years.
Kedah’s chief minister, Muhammad Sanusi Md Nor, stated the proposal to restore Langkawi’s full duty-free status was aimed at revitalising the island’s economy. He said the shortage of duty-free products, which were previously a major draw for tourists, was among the reasons for the current decline in Langkawi’s appeal.
He has proposed expanding the list of duty-free goods, including luxury vehicles, to attract high-spending visitors. “When wealthy visitors come, they should be able to buy expensive cars at lower prices and spend in Langkawi,” he said, noting the potential spillover benefits for the local economy.
Tourism stakeholders have welcomed the federal government’s willingness to reassess the policy.
Raseli Yahya, chairman of the Langkawi Tourism Industry Players Association, described the review as timely, citing increasing operational costs and a drop in domestic tourist interest.
“We appreciate prime minister Seri Anwar Ibrahim’s concern in recognising the current challenges faced by Langkawi’s tourism industry, including rising operating costs and declining appeal among domestic tourists,” he said.
Langkawi was declared a duty-free island on January 1, 1987. However, on January 1, 2021, duties were imposed on tobacco products, including cigarettes, marking a shift away from its fully duty-free status and slightly diminishing its appeal as a shopping haven.
