The revenue already sitting inside a state's own data
Every state government faces the same balancing act. Citizens expect better roads, tourism facilities, cleaner public spaces and stronger environmental protection, yet governments are constantly challenged to fund those initiatives without increasing the financial burden on businesses or taxpayers. Raising taxes is politically difficult, introducing new levies can discourage investment, and expanding enforcement usually means hiring more people and increasing administrative costs. Every option carries a trade-off.
Over the past few years, however, Malaysia has quietly introduced another approach. Instead of creating broad-based taxes, several states have implemented sustainability fees on accommodation as a way to ensure tourism contributes directly to maintaining the destinations visitors enjoy. Pahang, for example, introduced its Sustainability Fee of RM3 per room per night in 2022. By 2023, the fee had generated almost RM10 million, and by May 2024, collections had already reached nearly RM5 million, with the revenue earmarked for tourism development and environmental conservation.
The tourism economy itself continues to grow. As of March 2024, Pahang had already welcomed approximately 2.8 million domestic and international visitors. At the same time, the way people travel has changed significantly. Thousands of accommodation providers now operate through digital booking platforms alongside traditional hotels. Market intelligence indicates there are close to 7,000 active short-term rental listings in Pahang alone, with annual revenues and booking activity continuing to increase year after year.
Looking at those numbers together made me wonder whether everyone was asking the wrong question.
Most discussions focus on creating new sources of revenue. I became interested in something else. What if part of the opportunity already existed? What if the challenge wasnât introducing another policy, but improving visibility into an existing one?
That question came from studying how certain tourism-related levies are administered. Like many regulatory systems around the world, they depend largely on information declared by accommodation operators. There is nothing inherently wrong with that model. Self-declaration is practical, efficient and relatively inexpensive to administer. But every self-reporting system shares the same limitation. Its accuracy depends on how complete and timely the information is.
My observation was surprisingly simple. Digital booking platforms already generate large volumes of transactional data. Governments already receive declarations from accommodation providers. If those two perspectives could be compared intelligently, perhaps the opportunity wasnât another tax at all. Perhaps it was seeing the existing economy more clearly.
The technology was never the difficult part. Building software has become considerably easier than it was only a few years ago. The more difficult challenge was institutional rather than technical. Understanding how government departments work, knowing where different datasets reside, recognising which approvals matter and appreciating the realities of public administration are not things that can be learned from documentation alone. They come from experience.
Years spent working on digital transformation initiatives with state governments gave me that perspective. Shipping a state payment platform in four months teaches you where the datasets actually sit and whose approval actually matters. But those same years also highlighted my own limitation. I understood the problem and had a clear view of the solution, yet I didnât possess decades of credibility inside that particular state government. Software could not solve that problem.
Earlier in my career, I would probably have tried to build everything myself. I believed every important asset had to belong to me before I could pursue a significant opportunity. This project challenged that belief.
The idea began with a conversation. I shared the observation with a trusted friend, who introduced me to someone he believed should hear it. That conversation led to another introduction, and then another. The project never expanded through aggressive networking or sales. It grew through trust. Each introduction added something the previous conversation lacked. One person understood government operations. Another brought credibility developed over decades. Another strengthened the technical capability. What started as a single observation gradually became a multidisciplinary team, and today that proposal is in its final stage of discussion.
Looking back, I realised the software was never the greatest asset in the project.
Neither was the idea.
The greatest asset was trust.
For years I thought leverage meant raising more capital, hiring more people or acquiring better technology. Today I think differently. Capital certainly creates leverage, but so do relationships, credibility and accumulated experience. Those assets cannot be purchased overnight because they are built through years of consistent work.
I think organisations operate much the same way, as we become the average of the five people we spend the most time with. Their ability to solve meaningful problems is determined not only by the people they employ, but by the expertise, credibility and trust they choose to surround themselves with.
Whether this proposal ultimately proceeds is almost secondary to the lesson it taught me. I didnât learn how to generate government revenue. I learned how value is created.
The observation belonged to one person.
The solution belonged to many.
Perhaps thatâs the real meaning of leverage. Not owning every asset yourself, but recognising which assets already exist, and bringing together the right people to create an outcome that none of them could have achieved alone.
Once launched, Iâll share the thinking behind the framework, the economics, the challenges of data in the public sector, and what I learned throughout the process.
Stay tuned.