Government extends SST exemption period to June 30, 2021 – 100% on new CKD cars, 50% for CBU

In a new twist, the government has now announced via a memo issued to the Malaysian Automotive Association (MAA) and Malaysian Association of Malay Vehicle Importers and Traders (PEKEMA) that there will be an extension to the new vehicle sales tax exemption period to June 30, 2021. We’ve since checked with MAA, who confirmed the matter.

The sales tax exemption, which has been in place since June 15, was originally scheduled to come to an end on December 31 this year. According to the memo, the percentage of sales tax exemption remains unchanged from what was announced before, with 100% for locally-assembled (CKD) cars and 50% for fully-imported (CBU) cars.

Not too long ago, the Malaysian Automotive Association (MAA) revealed that a request to extend the sales tax exemption period was denied, but it looks like the government has had a change of heart.

The new vehicle sales tax exemption is part of the government’s Penjana programme in order to spur demand within the local automotive market. The sales tax exemption has resulted in reduced prices for passenger cars, although pick-up trucks are not eligible as they are classified as commercial vehicles.

Another change of direction that we recently reported on relates to the government’s decision not to change the excise duty regulations for CKD cars, which would have resulted in the prices of CKD cars going up, if put into action. With both announcements, it looks like car buyers have more of an initiative to make their purchase, so will you?