As the golf industry continues to flourish in Southeast Asia, understanding the tax landscape is crucial for anyone concerned about the SEA golf industry. In this article, Asia Golf Journey (AGJ) provides an overview of the various golf tax rates across the region, highlighting how these taxes can affect operations and competitiveness between countries, and what the governments of each country are expected to change in 2025.
"𝑆𝑡𝑎𝑦 𝑖𝑛𝑓𝑜𝑟𝑚𝑒𝑑 𝑜𝑛 𝑡𝑟𝑒𝑛𝑑𝑠, 𝑖𝑛𝑛𝑜𝑣𝑎𝑡𝑖𝑜𝑛𝑠 & 𝑑𝑒𝑣𝑒𝑙𝑜𝑝𝑚𝑒𝑛𝑡𝑠 𝑖𝑛 𝑡ℎ𝑒 𝐴𝑠𝑖𝑎𝑛 𝐺𝑜𝑙𝑓 𝐼𝑛𝑑𝑢𝑠𝑡𝑟𝑦"
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High Golf Tax Rates in Southeast Asia
In Southeast Asia, golf service taxes vary significantly from country to country. These taxes influence pricing strategies, customer attraction, and the overall growth of the golf industry. For instance, countries like Vietnam and Cambodia impose relatively high taxes, while others, such as Singapore, Malaysia, and Thailand, maintain lower rates to encourage domestic participation and tourism in the sport.
Vietnam, which has nearly 20 golf courses opened in the last three years, leads the region with a tax rate of 32%. In contrast, Thailand offers a more favorable tax environment with an 11% excise tax applied only to green fees. Malaysia promotes golf with an 8% tax rate, while Singapore maintains a streamlined 9% VAT.
Countries with higher tax rates, such as Vietnam, Laos, and Cambodia, risk discouraging participation in the sport if these costs are passed on to consumers. Conversely, lower tax rates in Singapore, Thailand, Malaysia, the Philippines, and Indonesia can make these destinations more attractive to both local and international golfers.
Country-Specific Tax Overview
Vietnam's tax rate on golf services is leading the charge with a 32% tax rate
Vietnam imposes the highest golf service tax rate in Southeast Asia at 32%. This includes a 10% Value Added Tax (VAT) and a 20% Special Consumption Tax (SCT). Despite this high tax burden, golf rounds at courses across the country have remained robust, matching the levels seen in 2019 and even a bit higher. With the economy significant growth, this resilience indicates Vietnam's position as a leading golf development hub in the region, attracting both local and international golfers seeking high-quality experiences.
Cambodia and Laos: A Close Second and Third with 21% & 28%
Cambodia has a combined tax rate of 21%, including a 10% Specific Tax and a 10% VAT. However, with only eight golf courses, this tax structure could impede the growth of the sport. Currently, the government has not announced any upcoming changes, which may affect future investments in golf facilities. Laos follows with a 28% tax rate, and is expected to build more golf courses in the next few years
Thailand: A Favorable 11%
Thailand offers a more favorable tax environment with an 11% excise tax applied solely to green fees. The standard rate of VAT is 10%, but it has been reduced to 7% until September 30, 2024 (unless further extended by the government). Additionally, Thai companies can charge a 3% withholding tax upon check-in. There are no planned changes to this tax structure, making it a competitive destination for golfers. Some industry insiders believe that high charges in other countries could deter international golfers from seeking cost-effective travel options to Thailand in the future.
"𝑆𝑡𝑎𝑦 𝑖𝑛𝑓𝑜𝑟𝑚𝑒𝑑 𝑜𝑛 𝑡𝑟𝑒𝑛𝑑𝑠, 𝑖𝑛𝑛𝑜𝑣𝑎𝑡𝑖𝑜𝑛𝑠 & 𝑑𝑒𝑣𝑒𝑙𝑜𝑝𝑚𝑒𝑛𝑡𝑠 𝑖𝑛 𝑡ℎ𝑒 𝐴𝑠𝑖𝑎𝑛 𝐺𝑜𝑙𝑓 𝐼𝑛𝑑𝑢𝑠𝑡𝑟𝑦"
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Malaysia: Promoting Golf with an 8% Tax Rate
Malaysia promotes golf as a sport by maintaining a lower tax rate of 8% on golf services. Additionally, there is a 6% tax on food and beverage (F&B) and a 10% service charge that benefits staff. This competitive tax environment encourages growth and participation in the sport, with around 252 golf courses available across the country.
Singapore: Remaining at 9%
Singapore imposes a straightforward 9% VAT on golf services. With about 20 golf courses in the country, Singapore continues to attract golfers seeking high-end facilities and exceptional service. The reasonable tax rate contributes to maintaining the quality and accessibility of golf in this bustling city-state.
Indonesia: Tax Increases on the Horizon
The Indonesian Government plans to increase the Value Added Tax (VAT) rate from 10% to 11% starting April 1, 2022, with a further increase to 12% on January 1, 2025. While Indonesia boasts many beautiful golf courses, concerns over terrorism and natural disasters have led to travel advisories that may deter potential visitors.
The Philippine golf market is bolstered
The Philippines applies a 12% VAT on green fees, cart rentals, and F&B items sold in clubs, mandated by the national government. Apart from that, the golf courses pay the usual property taxes for land and our buildings to the city government. Recently, Some membership golf clubs around the country won a case against the Bureau of Internal Revenue on the imposition of the VAT on monthly membership dues. There was also a case that golf clubs won against the City Government of Cebu on the imposition of a 10% amusement tax on green fees. The money that had already been collected was converted to tax credits for the clubs.
According to Mr. Nimrod Quiñones (General Manager at Alta Vista Golf and Country Club): “The taxes imposed do not really have a significant impact on our club as we are a private club with a big membership base. What affects us though would be the government-mandated privileges given to Filipino citizens who are aged 60 years old and above as well as government-certified persons with disability. The senior and PWD ID card holders are given a 20% discount of the net amount less the VAT as they are exempt from paying the value added tax. This has a significant impact on us due to the big number of senior members and guests who come to our club.”
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Actions are Being Taken in Some Countries
Mr. Simon Mees, PGA, CMA Dip (Former GM at Pineapple Valley Golf Club), believes that high taxes on golf services in some SEA countries are detrimental to the industry, making it expensive compared to popular golf travel destinations. Similarly, Ms. Nancy Nu (Sales Manager at Legend Danang Golf Resort) anticipates some reductions in tax rates soon to facilitate Vietnam's golf business growth. In a recent meeting, the Vietnam Tourism Association submitted a proposal to the government to reduce golf taxes to 5-10%.
As Southeast Asia continues to enhance its golf offerings, staying informed about the financial landscape is crucial for course owners, managers, and directors to make strategic decisions in the coming years. By cultivating a positive golfing environment despite the challenges posed by tax burdens, countries in the region can significantly enhance their attractiveness to both local and international golfers.
The report is gathered from various sources provided by industry experts and our partners working at golf courses in Southeast Asia. We would like to express our gratitude to: Mr. Chris Geraghty (General Manager at Vattanac Golf Resort); Mr. Nimrod Quiñones (General Manager at Alta Vista Golf and Country Club); Mr. Harris Abdullah (General Manager at Els Club Teluk Datai Malaysia); Mr. Paul Burley (Senior Vice President - IMG Golf Course Service); Mr. Simon Mees (Former GM at Pineapple Valley Golf Club Hua Hin); Ms. Nancy Nu (Sales Manager at Legend Danang Golf Resort); and other trusted sources from Vietnam Briefing; Worldwide Tax Summaries; Inland Revenue Authority of Singapore; PAJAK Indonesia; Avalara; Vietnam People's Representative Online Newspaper.
(Disclaimer: This report is intended as a general informational resource and reflects the accuracy of the information as of the publication date. Asia Golf Journey (AGJ) disclaims any liability for the completeness, errors, or omissions contained herein and makes no representations regarding the accuracy, comprehensiveness, or suitability of the information provided. This collection has been curated by Asia Golf Journey, with contributions from various credited sources. AGJ undertakes no obligation to update, amend or in any way modify this report or to notify readers in the event that any subject matter or opinion, forecast or estimate contained in the report changes or becomes inaccurate.)
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