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Many of you may have probably heard or already know that the road tax charged on vehicles in East Malaysia – Sabah and Sarawak – is less compared to vehicles in the Peninsular. However, why is this the case?

In actuality, there are guidelines issued by the Road Transport Department (JPJ) on the matter, here, where there are several zones, each with their own road tax rates. The zones include the Peninsular, Pangkor Island/Langkawi, Sabah/Sarawak and Labuan Island.

For the purpose of this article, we’ll focus only on passenger vehicles (motorcycles and commercial vehicles have their own rates) that are privately registered, and highlight the difference in road tax between West Malaysia, as well as Sabah and Sarawak.

The department classifies passenger vehicles into two categories – “saloon” and “non-saloon.” The former refers to vehicles such as sedans, hatchbacks, wagons, and coupes, while the latter encompasses pick-up trucks, MPVs, and SUVs.

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Based on the respective categories, the vehicle’s road tax is determined via the engine’s capacity or displacement. The current formula used by the JPJ (amended after the 2009 Budget) involves classes of vehicles with engines under and above 1,600 cc in capacity.

For “saloon” vehicles with engines below 1,600 cc, there are four other groups with a fixed road tax rate – 1,000 cc and below (RM20), 1,001 cc to 1,200 cc (RM55), 1,201 cc to 1,400 cc (RM70), and 1,401 cc to 1,600 cc (RM90).

Meanwhile, “saloon” vehicles with engine capacities above 1,600 cc have five separate groups, each consisting of a base rate and progressive rate that is added on for each incremental cc.

For engines with a capacity of 1,601 cc to 1,800 cc, the base rate is RM200, while the progressive rate is RM0.40 for each cc difference from 1,600 cc. Next, vehicles with engines between 1,801 cc and 2,000 cc are charged a base rate of RM280, with a progressive rate of RM0.50 per cc difference from 1,800 cc.

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Road tax structure for Sabah and Sarawak, saloon-class vehicles.

This is followed by a capacity of 2,001 cc to 2,500 cc (base rate RM380, progressive rate RM1 per cc difference from 2,000 cc), 2,501 cc to 3,000 cc (base rate RM880, progressive rate RM2.5 per cc difference from 2,500 cc), and exceeding 3,000 cc (base rate RM2,130, progressive rate RM4.50 per cc difference from 3,000 cc). All the rates mentioned up to this point are applicable only for Peninsular Malaysia.

By comparison, the table above shows us the road tax rate charged on passenger vehicles classified as “saloon” in Sabah and Sarawak. As you can see, the rate applied to the sub-categories associated with cars that are fitted with engines below 1,600 in capacity are as follows – 1,000 cc and below (RM20), 1,001 cc to 1,200 cc (RM44), 1,201 cc to 1,400 cc (RM56), and 1,401 cc to 1,600 cc (RM72).

It is a similar case for vehicles with engines above 1,600 cc, where engine capacities from 1,601 cc to 1,800 cc have a base rate of RM160, with a progressive rate of RM0.32 per cc difference from 1,600 cc. Each sub-category after that follows in the same path, considerably lower than in Peninsular Malaysia.

Furthermore, “non-saloon” vehicles in Sabah and Sarawak are also charged a lower road tax rate than those in Peninsular Malaysia, as you can see below. As an example, a pick-up truck with an engine capacity of 3,500 cc will be charged a road tax of RM2,440 in Peninsular, whereas in Sabah, it’s only RM1,503.

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Road tax structure for Sabah and Sarawak, non-saloon-class vehicles.

You can consult the list of road tax rates in Malaysia, here, if you want to source further examples. Alternatively, if you want a quick and easy way to calculate your road tax, Carbase.my has an application that can do it for you as well.

So, why the significant difference in our example above? According to director of the JPJ’s automotive engineering department, Datuk Mohamad Dalib, there are several factors for this. “The geographical condition there, travel distance, as well as the condition of road facilities and infrastructure prepared (by the government), are vastly different,” he said, referring to East Malaysia.

“Journeys take a longer time (there), even for short trips. Why? In rural areas, motorists need to navigate poorly-surfaced, tight roads, where they need to follow a queue to pass through, and there are even areas where they are required to board a ferry to cross a river,” he explained.

“In such situations, can you drive a (Perodua) Kancil? Yes, but only within city limits. Therefore, motorists there require four-wheel drive vehicles, which are substantially more expensive compared to a Kancil. The cheaper road tax structure (there) is meant to compensate for any shortcomings that exist as a result, ” he added.

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The geographical terrain of Sabah and Sarawak results in motorists there having different needs compared to those in the Peninsular. As a result, four-wheel drive vehicles powered by large capacity engines are commonplace in Sabah and Sarawak, and are more suited for day-to-day use there.

However, will the situation continue to exist forever? “When it reaches a point where the infrastructure and road network there have achieved a level of quality enjoyed by motorists in the Peninsular, it isn’t impossible that the road tax rates will be re-evaluated later on. For now though, it will remain as is,” explained Mohamad Dalib.

As for vehicles that are registered in East Malaysia, but driven in the Peninsular, he explained that there is no issue if you don’t get into an accident. If you do, there is a possibility the insurance company will not bear the costs, and you will be unable to claim anything. To prevent this unpleasantness, Mohamad Dalib said owners should inform the JPJ that the vehicle will be used in Peninsular Malaysia.