We’re no dealers, but we can imagine that showrooms are currently chock-full of customers looking to cash in on the sales and service tax (SST) exemption, which ends in exactly one week. While the government refused to extend the tax holiday, it has decided to push back the expiry date for vehicle registrations to March 31, 2023, giving car companies ample time to fulfil the onrush of orders.
Trouble is, of course, this will encourage many individuals to literally make bookings on a whim, even if they have absolutely no intention of buying a car – only so that they can lock in that rebate, just in case they want to use it at some point. This has dire consequences for the automotive industry, with Maybank Investment Bank predicting a wave of cancellations over the next nine months.
In a research article, picked up by Bernama, analyst Liaw Thong Jung said this will cause “unnecessary” operational issues on the dealer side, as “prospective buyers can cancel and/or transfer their orders and secure deposit refunds anytime.” The spike in orders, he added, will also “skew the bookings” and cause a lull in July and the rest of the second half of the year, which would not look good on salespeople and dealers.
Liaw also expected certain buyers to request for delivery in 2023 in the hopes of snagging a newer 2023 vehicle instead of a 2022 one. “That could see weaker 2H22 [second half of 2022] and strong 1Q23 TIV [first quarter of 2023 total industry volume],” he wrote.
Maybank IB is maintaining its 2022 TIV forecast of between 580,000 and 600,000 units, Liaw said, adding that the SST exemption – which has been extended three times since the original end-December 2020 deadline – has proved popular with 868,422 vehicles sold during this period. This, he wrote, also helped counter the economic impact of the COVID-19 pandemic.
Liaw also said that while finance minister Tengku Datuk Seri Zafrul Abdul Aziz claimed the government lost RM4.8 billion in revenue through the SST exemption exercise last week, the boost in income from import and excise duties during this period would “far outweigh” this loss.
Had SST not been waived, he noted, customs would have collected lower taxes due to reduced sales. “Excise duties alone accounted for 67% of [automotive] tax in 2019,” Liaw wrote.
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ppl usually cancel car booking that is no more competitive after delayed and realizing about it.
e.g
missing AEB,
missing AAC,
missing BSM, etc.
Instead of asking SST exemptions, would suggest for those buyers who book before 30th June, can change their dealers with IC card to make more easier
JPJ already claimed we have 22million active registered vehicle.
Malaysia annual sales of Vehicle inclusive commercial vehicles, only 600,000.
only 2.7% maa..
Government like to promote ‘internal circulation’
instead of promote more production and sales,
instead of promote business to prosper,
they forgotten mass production able to help our car to be competitive and be exported out.
I have no idea, is MATRADE really have strategy, or just SOP.
Being salty for not booking an sst exempted car or salty for watching others getttng their cheaper cars? :-)
Give SST exemption ..got problems
Dont give..got problems
So,Tengku Z..just U turn lah..July 1…TAX HOLIDAY HABIS.
Those who cant afford new cars,visit used car dealers.
No SST exemption, won’t create more traffic jams
SST exemption, got problems
True!!
i dont see the cancellation being a problem. Who is complaining if it is true? The car manufacturers? why should they when as it is, the waiting list is so long and they are struggling to fulfill orders, the very reason why extension is given at the first place.
And I was in P2 showroom just today, i dont see anyone at all, espeacially the booking of Alza starts today.
Traffic Jam, semua booking online for last 7 days ni.
Proton, Toyota, Honda Showroom pun tak ramai.
Honda HR-V tu orang pergi buat tiktok saja, lepas tu keluar tunjuk pandai comment comment apa yang kurang..
yes captain obvious
Fully agree. This BN PAS gahmen so akal pendek narrow minded, too busy to think of Rakyat problems… and much needed new car buys. Only think of getting their nxt multi million paycheck , so say NO to BN PAS.
Lol i have no idea waht u agree on or how this is related to BN or worse to PAS whichever the case you must drunk.
Remove excise taxes you buffoon zafrul/ BN. Already gain independence for 65 years and proton and perodua already old companies that no need protectionism. Proton itself is already 49% not owned by Malaysia but still want to protect them.
I think Malaysians have had enough of overpriced cars and feeding your cronies with the absurd upto 200% excise tax.
bendahari Z is just a messenger obeys order from umbrella colour sames as chrysanthemum
U forgot still need to protect P2 is it?
They are willing to spend RM80k in order to get a RM2k saving.
bravo to majority car owners gladly saved rm2k for the sake of paying 9 years hire purchase interest nearly rm20k
Yep, thanks to our GOV, more people get into unnecessary debt cycle.
Now we’re talking. at least some one from Maybank is using the brain to predict what is gonna happen. on the other hand, all the high post kawan kawan in the cabinet don’t think before act. at this point, no one will be pissed if you just expire the whole thing according to plan. no big deal. car is not essential item like food. BUT NOW.. caused a big mess!!! and dragging the resources and time to continue look into this. that is why we are still not moving developed status!!! and the SST to GST to SST and future GST..NUMBER ONE lor!
SST 100% CKD rebate, 50% SST rebate CBU can be reduced @ mulitple stage also.
So it has minimal impact price difference to its booking.
E.g
By September registered – 75% SST rebate for CKD, 35% SST rebate for CBU.
By December registered – 50% SST rebate for CKD, 25% SST rebate for CBU.
By March 2023 – 25% SST rebate for CKD, 15% SST rebate for CBU.
By June 2023 – 0% SST rebate for ALL.
No route path, manufacturer how to plan launching new car? Pricing is sensitive and need to be competitive.
Keep extend, no SST, no GST,
Rugilah, dah nama Endermic ni.
2 tahun subsidy semua orang dah, 22Juta kereta on the road maa. If no use pls sell out? MyTukar senang jual.
Simpan simpan kacau parking bay.
lagi EV Tax Free subsidy orang kaya T01 ada sampai 2025.
Gomen assumed ni pun dah announced 6 months ahead.
but finally the problem is booking-registration time difference. Planning Failed punya.
Booking, loan approval also only last 3 months. Ppl usually has right to change his mind only after this loan being not valid anymore.
Maybe – 3 months step down rebate seems aligned and practical approach. Dealer/Manufacturer also able to inform and should keep promise if delivery within 2-3 months or 3-6 months, etc -> or absorb the lost.
By the means of step down rebate – the cost absorption is less.
No need extend la! Tax exemption got problems for traffic jams. Now having problems for chicken, subsidy and eggs, price hike soon. Do something, cars aren’t essential but chicken, subsides and eggs are essential