Its deputy chief, Chong Yew Chuan, said the omission of subsidies for tour buses and vans would lead to increased costs in the tourism sector, thus reducing Malaysia’s competitiveness as a tourist destination.

“It will not only jeopardise the livelihood of tourism operators but also adversely affect the overall economic expansion of the country,” he said in a statement.

Last week, Prime Minister Anwar Ibrahim announced that the Cabinet had agreed on targeted diesel subsidies for Peninsular Malaysia.

He said 10 types of public transport vehicles and 23 types of goods transport vehicles will continue to benefit from diesel subsidies.

On Monday, the finance ministry introduced the diesel subsidy aid programme, under which RM200 will be provided monthly to eligible individuals as well as agriculture and commodity smallholders.

The aid is not extended to individuals who own diesel motorcycles, caravans, motorhomes, and tour vans and buses.

Chong said with the continuous depreciation of the ringgit, now is the best time to attract international tourists and boost the growth of the industry.

“The government has repeatedly emphasised revitalising the national economy through tourism.

“However, the government’s move to end the diesel subsidy for tourist buses and vans will lead to a hike in domestic travel costs.

“This weakens Malaysia’s attractiveness as a tourist destination, ultimately undermining the government’s efforts to attract tourists. It’s like shooting oneself in the foot.”

Previously, it was reported that the government aimed to attract about 36 million tourist arrivals and generate RM150 billion in tourist receipts for Visit Malaysia Year 2026.