VATupdate

Share this post on

Malaysia continues to waive consumption tax for new cars

Unofficial translation

Because of Covid-19, the government of this country continues to exempt consumption and service tax (SST), 100% for assembled cars and 50% for imported cars, until the end of 2021.

In order to stimulate consumption, this is the second time that the Malaysian government has extended the SST incentive package for domestically assembled passenger cars (CKD) and imported complete units (CBU) due to the impact of the Covid-19 epidemic. The previous extension was from January 1, 2021 to the end of June after applying the first phase (June 15, 2020 to December 31, 2020 ), according to Paultan .

The current SST tax is 10% for both CKD and CBU vehicles (equal to VAT in Vietnam), which is added to the retail price. The SST exemption will help reduce the price of cars significantly, while pickup trucks are not part of the incentive program because they are classified as commercial vehicles.

With this extension, Malaysians no longer have to worry that the new car buying incentive program is about to end as scheduled (June 30, 2021). They have half a year left to buy a car at a lower price than usual.

The situation of the Covid-19 epidemic in Malaysia continues to be complicated. According to WorldOmeter data , Malaysia recorded 572,357 Covid-19 infections as of June 1, ranking third in Southeast Asia in the number of cases after Indonesia and the Philippines. The government of this country locked down the whole country starting from June 1 and lasting for 2 weeks.

In Vietnam, a third Covid-19 outbreak is also underway. After Decree 70 imposed a 50% reduction in registration fees for domestically manufactured and assembled vehicles that ended on December 31, 2020, the Vietnam Automobile Manufacturers Association (VAMA) continued to propose extension, but the Ministry of Finance in a written reply in May, disagreed because it said it was “not appropriate in the current context”. Unlike the SST exemption in Malaysia, which helps to reduce the car price, the registration fee exemption in Vietnam does not reduce the price of the car but reduces the cost of rolling it.

Source vnexpress

Sponsors:

VAT news
VAT news

Advertisements: