Malaysia’s EV policy to offer tax-free cars, lower road tax, green parking, toll rebates, charging incentives

Malaysia’s EV policy to offer tax-free cars, lower road tax, green parking, toll rebates, charging incentives

Malaysia says it is ready to offer a “handsome level” of tax incentives to accelerate its electric vehicle (EV) agenda in the country. Beyond fixed incentives that will benefit both users and the industry, the government will look into adding on further customised incentives for manufacturers based on their level of commitment, according to Malaysia Automotive, Robotics and IoT Institute (MARii) CEO Datuk Madani Sahari.

Speaking yesterday during a webinar session titled A New Start for EV In Malaysia organised by Eurocham Malaysia’s Automotive Sector Committee, he said that the new EV policy will contain fixed and defined incentives, unlike at present, where incentives are customised under the National Automotive Policy (NAP 2020).

“Currently, we are implementing customised incentives, depending on your economic benefits. But under the new EV accelerated policy, there are fixed incentives. One part of these fixed incentives is related to the excise duty, import duty and sales tax, in terms of what users and the industry is going to enjoy,” he said.

“But on top of that, if you are bringing into Malaysia something extraordinary, we are willing to consider even higher level of incentives, one that will be customised exactly to the level that you are bringing into the country,” he explained. This initiative will not only cover carmakers but also EV component manufacturers.

Malaysia’s EV policy to offer tax-free cars, lower road tax, green parking, toll rebates, charging incentives

As for buyers, tax incentives are being finalised in the accelerated policy, and the government was looking at providing a host of benefits for EV adopters, Bernama reports. Madani said that users would generally enjoy direct incentives such as lower road tax, the benefit of a green parking scheme, toll rebates as well as rebates on the installation of home chargers.

Last month, Madani said that discussions related to buyer incentives also included the possibility of rebates being offered for the upgrading of wiring – from single phase to three phase – for home chargers.

“This mechanism is in the final approval by the government but apart from that, as far as the industry is concerned, in principle, we are really going for a handsome level of tax exemption, in the form of a huge tax reduction in terms of excise duty, import duty and sales tax for EVs,” he said.

How much of a reduction this will entail remains to be seen, as the excise duty for fully-imported EVs is currently set at a low 10%, regardless of brand. If is also not determined how many units will enjoy this exemption, and for how long.

A study published by the Malaysian Green Technology And Climate Change Centre (MGTC, formerly known as GreenTech) last month suggested some numbers. In the Low Carbon Footprint Blueprint, it was revealed that full tax relief would be provided for 10,000 units of fully-imported EVs vehicles, the exemption applicable until the end of 2022. From 2023 to 2025, CBU EV units will be given a 50% import and excise duty exemption, in what is a bridging measure until locally-assembled BEVs become available on the market.

According to the document, incentives will also be structured with plug-in hybrids (PHEV) in mind. These include tax exemption for qualified CKD models, with 100% exemption being given until 2022, 75% exemption from 2023 to 2025, and 50% exemption from 2026 to 2030.

Qualifications will also be put in place for PHEVs, based on the electric range per charge and with no engine charging. These are set at an initial 30 km range (NEDC) for this year, expanding to 55 km (NEDC) from 2022 to 2024 and 75 km of travel per charge (WLTP) from 2025 to 2027, before being finally set at 100 km (WLTP) from 2028 to 2030.

Details can be expected when the long-awaited EV policy is finally revealed. Madani said it is hoped that the policy could be brought to the cabinet for approval by June, before it is announced in July. The policy was originally scheduled to be announced in the first quarter of the year.

As it was when we spoke to him last month, he reiterated that the new EV policy will be comprehensive in its application and reach. “The scope of the new policy will include passenger cars, scooters, motorbikes as well as commercial vehicles. It will also include original equipment manufacturers (OEMs), manufacturers of EVs as well as companies that are using EVs as a form of service, such as SoCar and Grab,” he said.

Looking to sell your car? Sell it with myTukar.

10% discount when you renew your car insurance

Compare prices between different insurer providers and use the promo code 'PAULTAN10' when you make your payment to save the most on your car insurance renewal compared to other competing services.

Car Insurance

Anthony Lim

Anthony Lim believes that nothing is better than a good smoke and a car with character, with good handling aspects being top of the prize heap. Having spent more than a decade and a half with an English tabloid daily never being able to grasp the meaning of brevity or being succinct, he wags his tail furiously at the idea of waffling - in greater detail - about cars and all their intrinsic peculiarities here.



  • Afeeq on May 20, 2021 at 12:43 pm

    America offers $7500 federal tax credit on top of no crazy excise/import taxes. Will Malaysia do the same?

    Like or Dislike: Thumb up 29 Thumb down 0
    • History on May 20, 2021 at 3:52 pm

      again.. history repeating itself..
      what “level of commitment?” .. the damn policy is so shallow and shortsighted to begin with. and he is expecting manufacturers to jump in deep so fast? it all STARTS from Govt’s level of commitment.. not manufacturer’s level of commitment.. set the policy right and ahead of time, then the “commitment” will come…

      Like or Dislike: Thumb up 39 Thumb down 3
  • Donno on May 20, 2021 at 12:44 pm

    Too little too late.

    Other major car manufacturers has committed to investing billions for EV in Thailand and Indonesia.

    Like or Dislike: Thumb up 39 Thumb down 9
    • Danny Tay on May 20, 2021 at 4:02 pm

      not late actually. they would still done the same even if malaysia announced EV roadmap 2 years ago. our market is super small compared to other asean nations.

      Like or Dislike: Thumb up 19 Thumb down 3
    • Aura89 on May 20, 2021 at 7:24 pm

      Is it really better to be early? Take it from the experts
      EV isn’t all it’s cracked up to be.

      Like or Dislike: Thumb up 8 Thumb down 5
    • Donno on May 20, 2021 at 9:28 pm

      this is also a weak EV policy without even mentioning or including one of the most important point for EV take up, a policy to encourage the establishment of more charging stations all over the country by petronas, or other players.

      All the tax cut for EV vehicles is useless when the ecosystem is not conducive to drive fully electric vehicles.

      Like or Dislike: Thumb up 12 Thumb down 1
    • ThePolygon on May 21, 2021 at 8:46 am

      It’s not even enforced yet, still in planning stage… slowlah.

      Like or Dislike: Thumb up 7 Thumb down 2
  • Make Malaysia Great Again on May 20, 2021 at 12:47 pm

    Slow but steady, better late than never, never say never.

    Like or Dislike: Thumb up 18 Thumb down 4
  • How to bring into cabinet discussion if the parliament is still closed ? funny

    Like or Dislike: Thumb up 24 Thumb down 6
    • Lolwhut? on May 20, 2021 at 3:21 pm

      Google Meets
      Zoom Call
      Teams Meeting

      Like or Dislike: Thumb up 2 Thumb down 0
    • Danny Tay on May 20, 2021 at 4:10 pm

      what’s the rush? parliament will still open eventually. there is no immediate advantage switching to EV overnight. infra is still a big issue in all developing countries, Malaysia included.

      Like or Dislike: Thumb up 8 Thumb down 5
  • Karam Singh on May 20, 2021 at 1:01 pm

    Hahahaha june 2021. Could have done this 5 years ago.

    Like or Dislike: Thumb up 25 Thumb down 2
  • Bob Mal on May 20, 2021 at 1:23 pm

    Personally who would want a lower road tax??? When compared with another similar size car the savings is more than RM100k difference that would itself me for a (1111 years) of free road tax.

    For green parking scheme it is already available at many Shopping malls and petrol station and they are also giving out free charging.

    Cheaper Toll – well lets just wait and see since Malaysia is a special land of Toll where benefits only goes one way.

    Like or Dislike: Thumb up 19 Thumb down 1
  • @SnakeBabu on May 20, 2021 at 1:50 pm

    plan dulu..after darurat (2025) ,baru sembang at parlimen..then give statement Msia will venture in EV in 5years bla..bla..bla

    Like or Dislike: Thumb up 4 Thumb down 1
  • drMpower on May 20, 2021 at 2:04 pm

    like i said this madani guy no use at all

    u must reduce the cost of the vehicle itself. not the cost of running the vehicle. afterall, the vehicle requires considerably lower cost, given it uses less rotating equipments, and the usual long warranty coverage

    the economic cost must be immediate, to spur the interest.

    Like or Dislike: Thumb up 12 Thumb down 0
    • cannot immediate incentives, later Proton & Perodua immediately die due to they don’t have any EV product to compete.

      Like or Dislike: Thumb up 6 Thumb down 1
    • Mmmmm…. EV car for less than RM100k? That is the only car I can loan masa….

      Like or Dislike: Thumb up 3 Thumb down 1
  • If I am an auto player, I’ll probably take every Malaysian gment EV policy with a pinch of salt. Once bitten, twice shy lah.

    There will be no clear long term policy. Even if there is, it will be revoked on short notice after 2 years. Everything will be back at square one, and your asset will turn into a liability.

    Anyway, we are still a somewhat net oil exporter, unlike most neighboring countries which aggressively pursue this. That might explain the lackadaisical approach by the authorities. Don’t want to kacau the cash cow.

    In the end, we will probably end up still consuming the last ancient combustion engines for passenger cars. Like how we view the local Toyota engines now.

    Like or Dislike: Thumb up 7 Thumb down 7
    • our national oil company Petronas also not helping, they prefer their comfort zone & tongkat…other oil&gas companies already diversifying themselves to other energy sources to truly become a proper energy company, instead of relying on oil&gas as the only source of energy.

      Like or Dislike: Thumb up 8 Thumb down 9
      • Amriji on May 20, 2021 at 7:03 pm

        U sure or not? Don’t talk without knowledge. PETRONAS Solar Business is taking off. Also PETRONAS already have 61 units of 22kw AC chargers. Soon Ultrafast Chargers.

        Like or Dislike: Thumb up 6 Thumb down 3
    • But Toyota is producing electric, hybrid and fuel cells. Also, Toyota is already producing more Dynamic Force Engines with high fuel efficiency for many lineup toyota models, while still producing VVT-i engines but fuel efficiency is improving as moving from one generation or first batch to another.

      Like or Dislike: Thumb up 4 Thumb down 2
  • funky on May 20, 2021 at 2:20 pm

    For crying out loud, just stop putting import and excise on vehicles and just once be pro consumer choice.

    Like or Dislike: Thumb up 11 Thumb down 0
  • What is this Marii’s function? They have been talking about making this country an EEV Hub for many years but what are the results now?
    All these discontinued models like Prius, Prius C, CRZ, A6 Hybrid etc. were results of half-baked policies towards hybrid/ev vehicles.

    It’s either we go all-out for EV or we anoounce to the world we will go all-out ICE. Please make a decision.

    Like or Dislike: Thumb up 14 Thumb down 2
  • pomen on May 20, 2021 at 4:23 pm

    another ‘sembang bikin babi terbang’ proposal…haha

    Like or Dislike: Thumb up 4 Thumb down 0
  • Semi-Value (Member) on May 20, 2021 at 5:36 pm

    ckp byk aje

    Like or Dislike: Thumb up 7 Thumb down 0
  • Razak bin Najib on May 20, 2021 at 5:54 pm

    As usual……all talk and syok-syok announcement.

    Action? you know, I know la.

    Like or Dislike: Thumb up 6 Thumb down 0
  • SlyGTR on May 20, 2021 at 5:58 pm

    I am not too sure that we are looking at the problem in a comprehensive manner. First we should look at our ecosystem of cars and vehicles in Malaysia.
    1) manufacturing of actual vehicles and its components including the accessories. Our country needs the job creation and higher level job (ie R&D in battery, power trains etc would be prefered).
    2) Cost of ownership. (i dont have to list out as many have touched on this)
    3) Infrastructure to support EV vehicles. Here govt need to provide the infra or the very least incentivise the private party to do it eg “charging on the go”roads, supercharging stations, etc.
    4) All the 3 items above should also be focused to create an export market ready products and services whilst protecting own own intellectual property. Here our govt can emulate Singapore where they aggressively pursue those company that can assist eg TESLA, Google transport(?), Dyson. Our universities also should go into materials and technology research to spear ahead the EV revolutions. Also all those Gold Medals from iternational Innovation Conventions should be turned into proper businesses rather than collecting dust on medal on the shelf.

    Like or Dislike: Thumb up 5 Thumb down 0
    • Not only this,how about after sale in term of knowledge n skill for repair n maintenance ,in warranty period is ok.After warranty period go to ah kau shop can they do it to have low cost repair n used car price is low already not much people can pay the part cost even without labour.when talk about the labour it should be charge more than others cause it require high engineering knowledge n well training,do u think Nepal worker can do it since our public said yes???

      Like or Dislike: Thumb up 2 Thumb down 0
  • apamau on May 20, 2021 at 7:01 pm

    so potentially we gonna hv the following EV in future with those already hv ckd plant here..
    (company already hv EV in the market now)
    Nissan Leaf

    Out :
    Tesla (not possible to hv CKD or plant in tiny malaysia)
    top 3 china EV brand

    Like or Dislike: Thumb up 1 Thumb down 2
  • ABDUL AZEEZ AZLAFF on May 20, 2021 at 8:27 pm

    Allow full tax free incentives for EV players in the country for 5 years. By then the infra and invesment in the Ev industry will flourish. Once it has matured, then you may start imposing taxes slowly.

    Like or Dislike: Thumb up 0 Thumb down 0
  • Silthice on May 21, 2021 at 7:30 am

    EV is not green at all with 90% of Malaysia current energy ⚡ production is still using non renewable sources plus high electricity tariffs. The battery and motor itself is made from rare earth minerals and disposing them are hazardous to living things and the environment. If government is targeting long term sustainability plan, hydrogen is the real future which can be easily integrated with current fueling stations throughout the nation and can be filled up with minutes.

    Like or Dislike: Thumb up 7 Thumb down 1
  • Please don’t feel happy about it , this type of car not much people able to maintain once out of warranty it is not a simple tech like old man said battery n motor only can work for this car with high performance like forklift can run over 100km/h?As I know most of our public is think EV car is just power by 12v lead acid battery only with battery price over 1k only can get it just like eco start stop type use.So sad our public mind still stop at old man year,car still the same run on 4 Tyre???

    Like or Dislike: Thumb up 3 Thumb down 2
  • New car of EV not good enough… Just start to allow ppl to convert engine to EV is better move. Same like USA, Thailand and etc.. It help domestic economy. Make local manufacturers create local parts… Jpj need to let this happen. Let’s ppl enjoy free test and low road tax for old engine car to EV…

    Like or Dislike: Thumb up 0 Thumb down 0
  • Talk 1st class

    Action zero class ..

    Like or Dislike: Thumb up 0 Thumb down 0
  • Tapi harga mak datuk mahal gila..
    Akhirnya, tak ada yg mampu beli, hanya mampu tengok aje

    Like or Dislike: Thumb up 0 Thumb down 0
  • Chris on May 22, 2021 at 9:51 pm

    i am sure more and more will buy if the price is affordable…

    Like or Dislike: Thumb up 0 Thumb down 0
  • AFMGT YT on Jul 04, 2021 at 4:38 am

    Wonder why Taycan here is significantly more expensive than other markets..

    I am here in July 21, still no news of the EV accelerated policy..

    Like or Dislike: Thumb up 1 Thumb down 0
  • ZULKARNAIN OTHMAN on Jul 16, 2021 at 10:05 am

    TESLA made in China will continue reducing TESLA EV car price

    Like or Dislike: Thumb up 0 Thumb down 0
  • Apam Balik on Oct 17, 2021 at 11:53 am

    Any new updates on the Malaysia ev policy yet? Korean Ionic 5, Kia EV6 and Japanese Honda E and Nissan Ariya are very desirable vehicles not to mention China BYD, NIO or us made LUCID AIR. I’m writing this on October 17,2021. All major highways r&r should speed up with installing ev stations and TNB should be playing the major role of making all this possible

    Like or Dislike: Thumb up 0 Thumb down 0

Add a comment