Tax Exemption Will Boost Car Sales Say Industry Experts


The government yesterday announced 100% sales tax exemption on locally assembled cars and 50% exemption on imported cars from June 15 to Dec 31.PETALING JAYA: Two experts in the automotive industry have welcomed the “Penjana” short-term economic recovery plan, saying the RM35 billion stimulus package, which also addresses the automotive industry, will boost the sector
Prime Minister Muhyiddin Yassin yesterday announced sales tax exemptions on locally assembled cars (100%) and imported cars (50%) from June 15 to Dec 31 to help the automotive sector
Speaking to FMT, Malaysia Automotive, Robotics & IoT Institute’s (MARii) chief executive officer Madani Sahari said the “tax holiday” incentive would encourage consumers to expedite their decision to buy a car instead of prolonging it. MARii was previously known as the Malaysia Automotive Institute
“It is important that the industry maintains sales with a minimum of 500,000 units this year to remain sustainable in the long run
“With the tax holiday announced by the government, dealers now have more options to innovate their marketing and sales strategies to overcome consumer anxieties in purchasing their vehicles post-MCO,” Madani said
However, he advised buyers to make their purchasing decision based on affordability despite the tax exemption, saying that buyers should also include used cars as one of their purchasing options
“Vehicle ownership is not only contingent on the price of the vehicle, but one must also consider other factors such as maintenance, fuel consumption, wear and tear as well as safety
“This applies to the consideration in buying both new and used cars, as there are many options to purchase used vehicles that are cheaper in price compared with a new model, with adequate safety features,” he said
Malaysian Automotive Association (MAA) president Aishah Ahmad echoed Madani’s reaction towards the stimulus package, saying car prices would be lower with the sales tax exemption
“This incentive will benefit auto industry dealers,” Aishah said, adding that Malaysia’s total industry volume (TIV) for the automotive sector was expected to be favourably impacted by the stimulus package
“However, we can only gauge the TIV by mid-July to know if the stimulus package will help to increase vehicle sales,” she said. - FMT

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