Car showrooms are going to be busy places in the next one and a half weeks, with a surge in vehicle bookings expected following the announcement made by finance minister Tengku Datuk Seri Zafrul Abdul Aziz on the status of the sales tax exemption.
Yesterday, he said that the SST exemption will not be extended any further and that it would come to an end as scheduled on June 30, but the government is making an allowance for the SST exemption to be applied for any vehicle booked before July 1 and registered before March 31, 2023.
A spike in bookings before the month is out is thus expected, but while this will create a swell in orders for June, it could result in a potential sales glut for the remainder of the year, as The Star reports.
An analyst interviewed by the publication said there is the likelihood of an “order avalanche in the next 10 days” happening, as potential car buyers take advantage of the limited time left before the tax holiday ends. “Key implications include a likely surge in orders for the rest of June, bringing forward some sales from the second half of 2022,” he said.
This sentiment was shared by an industry observer, who cautioned that the discontinuation of the SST exemption could have the same implications as the tax holiday that was implemented in 2018. “When the government zero-rated the goods and services tax or GST for three months in 2018, it resulted in a spike in demand for vehicles. After the tax holiday ended, car sales were affected for quite some time,” he explained.
Meanwhile, Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad said the time extension will assist car companies to clear the backlog of orders. “Hopefully, the shortage of chips and components would be resolved by then,” she told the publication.
She said the association thanked the finance ministry for the concession to apply the SST exemption for vehicles sold during the exemption period until March next year. “We have a backlog of orders and so the move to allow until the end of March 2023 to register new vehicles that were booked by June 30, 2022 will pacify those customers who have a long waiting time,” she explained, adding that the move will also hinder order cancellations by customers.
She echoed the observation made by the industry observer with regards to the expected dip in sales once the SST exemption ends. She said the order bank is expected to slow down after June 30 before picking up again. “It has always been like that when there is a change in policy,” she said, but added that MAA expects to achieve its total industry volume (TIV) target of 600,000 units for 2022.
The SST exemption was first announced in June 5, 2020 as part of the Penjana stimulus package to mitigate the effects of the first movement control order, which took place from March that year. Originally scheduled to end on December 31 that year, the SST exemption was extended at the last moment to June 30, 2021, and then again to December 31, 2021. A third extension, which is the current one, was announced during the tabling of Budget 2022.
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Imma booked just booked the Bugatti La Voiture Noire and Rolls-Royce Boat Tail langkawi-plated to fully enjoy the free sst. Rewarding myself for the hardwork in the just completed projek Putrajaya mrt,
Putrajaya MRT not yet finish you say completed? Are you mad?
Copy paste: “Tenkiu Better Nation Gomen! Helping those who are still stuck with cars being processed! #KerajaanPerihatin #BetterNation #KeluargaMalaysia #LandslideVictory”
Time to rush!!
Before rushing to book and perhaps securing an early bird car,pls think deep and carefully.
The world’s richest man,Elon Musk has just laidoff 10,000 workers.The top economists of the world has predicted a US recession next year.
Once USA sneezes,the rest of the world have fever.
So,dont just blindly listen to the SA,”Beli je,jangan risau,I boleh kaotim 10 tahun loan”.
If u have done due diligence,and have plan B in case of recession,then pls go ahead.If not,just eat humble pie and maintain your current car.
Once the bank blacklist a delinquent HP car buyer,he can forget to get future bank loans.The blacklist stays for donkey years.
Tenkiu Better Nation Gomen! Helping those who are still stuck with cars being processed! #KerajaanPerihatin #BetterNation #KeluargaMalaysia #LandslideVictory
Majority voters got cheated by this terribly failed dysfunctional BN govt. pru15 Say NO to BN , noktah.
Hundreds of thousands of new car buyers disagree with you. On a ratio of 100,000 to 1 your voice is only 0.001%.
Every vote counts
How about HRV which is open for booking prior to launch, should the car be launch in July, is the exemption valid?
booked dulu…and make sure the date is written properly with an official stamp. when about time to get car, u can decide if you want it or just give it to other potential customer. they likely will pay you some money for your trouble…and the SST they get to skip
Blur blur Cucumber
If u really a diehard hardcore fan of Honda,book lah.
Unless you have plan B,thinking of Toyota.
If Honda open booking b4 July yes no problem to get exemption, now it is up to Honda.
Vehicle bookings will spike means more traffic jams?
you talk as if i only drive new car to work. without new car i will walk to my office
No worries. Under DAP rule, we ALL will have to walk to work. Only selected few will have cars under their regime.
Logical Deduction and Rakyat Malaysia are the SAME person
Oh yeah? And you and YB Albert and all the other fake names are the SAME person.
Regardless the message is clear, concise and speaks truthfully so it don’t who said it. Voting DAP will be like living hell with their policies.
No need to wait DAP, now under BN rule also we cannot find parking and have to walk. Only selected few can find parking lot. Traffic jam so bad that walk is faster than car.
just imagine, if the government dont have to bear responsibility to pay unnecessary debt like those of xxxxxx
then the monies can be spent giving subsidies or to cover for taxes. although this is temporary measure, people can be happy knowing the monies go to things that make them happy. plus the election is just around the corner, so why not.
but talk no use some billions going down to pay the interests alone..
Has u-turned since the first exemption…may u-turn again in last minute for coming GE gift
Government still have revenue to spend sst exemption when already ran out of their money?
Government still have growing salaries in their pocket.
Gomen still perihatin to staffs unlike chinaman companies cut salary and freeze raise but got money buy new company cars for boss and directors, all that sst exempted ya.
Are you saying we cut Proton workers salary and freeze raise? You know what car Geely boss is driving? Better go check check what cars GLC directors are driving and how much is their salaries.
But slowly growing salaries in their pockets. And still spending revenue on sst exemption will lose out billions of ringgit. Earning more slowly but spending rapidly
Deswai they stop sst exemption and focus on their pockets instead.
Yes, spending rapidly… in their pockets.
Knowing the way Malaysian systems work, the bookings will still continue up to March 2023, but with some tampering of the booking date those people will still be eligible for the SST exemption.