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Ahead of tomorrow’s implementation of the Goods and Services Tax (GST), the Perodua Dealers Association wants to be able to reclaim the 10% sales tax paid on unsold stocks, to avoid double taxation.

The new tax regime will see a 6% GST replacing the 10% sales tax. For stocks that have already been added to dealers’ inventories, the previously-paid sales tax may either be refunded partially, or not at all, depending on conditions (read more here).

“This means unsold stocks, with 10% sales tax already paid, will be hit by an additional 6% GST after April 1. Each independent dealer will stand to lose an average of RM230,000 on double taxation after April 1,” said Perodua Dealers Association president Wan Kamal Wan Ismail in a statement, although no explanation is offered as to how that figure was derived.

“Perodua dealers consist mainly of medium-size companies and losses on this scale will have a huge impact on our business, especially on our cash flow and profitability,” he added.

Statement by Perodua Dealers Association president Wan Kamal Wan Ismail

As the representative of the Perodua Dealers Association, I wish to plead with the government of Malaysia to allow us to reclaim the 10% sales tax on invoices issued prior to the implementation of the Goods and Services Tax on April 1.

As an introduction to the issue, the government is currently imposing a 10% sales tax on new vehicles, however, after April 1, the 10% sales tax will be replaced with a 6% Goods and Services Tax (GST).

This means unsold stocks, with 10% sales tax already paid, will be hit by an additional 6% GST after April 1. Each independent dealer will stand to lose an average of RM230,000 on double taxation after April 1.

Perodua dealers consist mainly of medium-size companies and losses on this scale will have a huge impact on our business, especially on our cash flow and profitability.