EVs are duty-free now. Will that still be the case come January 1, 2026? According to Sime Beyond Auto, the top BYD dealership group in Malaysia, no.
Yesterday, the company’s Trec KL branch posted up a graphic on Instagram saying ‘EV tax holiday ends in 96 days’ while urging punters to purchase a BYD in the remaining time. “With the EV tax holiday coming to a close, now’s the perfect time to drive home with a new BYD now,” it said.
Currently, CBU imported EVs are exempted from import duty and excise duty until December 31, 2025. This was announced in Budget 2023, an extension from the previous deadline of December 31, 2024, which itself was extended from the original expiry date of December 31, 2023.
Meanwhile, CKD locally-assembled EVs are exempt from excise duty (no import duties applicable, of course) and sales tax until December 31, 2027, which is two years more than the original deadline of December 31, 2025 announced during Budget 2022.
For now, there has been no indication from the government as to whether another extension will be given, but Budget 2026 will happen this month – we’ll see if there’s a last minute reprieve for OEMs peddling CBU EVs. As you’d imagine, the industry wants another extension.
“As far as EV subsidies are concerned, we would like to have the government continue (them). We feel that there is still not enough momentum for EVs and the market needs to have a continuation (of incentives) to ensure that there will be long-term effect,” MAA president Mohd Shamsor Mohd Zain said in July.
“It will also give an opportunity for other OEMs to plan production and establish a volume base. Right now, it’s only about 4% (market share) as far as EVs are concerned while HEVs are at about 4.6%, so it is still low in terms of the government’s aspiration of 15% (of total industry volume) by 2030.
“As far as the industry is concerned, we would like to see continued implementation (of incentives), and that way we will have more participation from the OEMs. Hopefully we will see new products, new models in the market,” he added.
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