Reducing excise duties for imported cars will result in the collapse of the second-hand market, said PM Datuk Seri Najib Tun Razak. He added that such the government will potentially incur a revenue depreciation in such a move, as it collects RM7 billion a year in import car excise duty, according to a Bernama report.
“We need to look in depth. It is not the time to come up with long-term solutions,” he said at #Tanya Najib: 2013 Budget Live on Astro Awani last night.
Najib said the government must take into account the entire ecosystem that depends on Proton for survival, not just the interests of the national automaker itself.
“Car ownership in Malaysia is one of the highest in the world and I do realise people want a better choice,” he said.
Recently, Parti Keadilan Rakyat (PKR) proposed to reduce car prices by auctioning Approved Permits (APs), suggesting that APs for cars should go through an open tender which would result in revenue for the country.