The tabling of Budget 2026 has come and gone without any mention of an extension of import and excise duty exemptions for CBU fully-imported electric vehicles, which the country has enjoyed since 2022. This means that as anticipated, prices of these cars will increase starting from January 1, 2026.
Malaysia’s ministry of finance (MOF) confirmed the news in its Fiscal Outlook and Federal Government Revenue Estimates report. In it, the ministry said it expects to collect RM12.79 billion next year, up from an estimated RM12.51 billion in 2025, partly as a result of the EV incentives expiring.
The government had twice extended the period for tax-free CBU EVs – originally slated for the end of 2023, the deadline was then postponed to end-2024 during Budget 2023, then to end-2025 once the current Madani government came to power soon after. There was no mention of an extension in Budget 2025, even as industry players continued to push for it.
Of course, there’s no surefire way of knowing how much more expensive CBU EVs will be next year, but Francis Lee, group CEO of Bermaz Auto that distributes the Xpeng brand, has recently said he expects prices to go up by “at least 20 to 30% minimum.” Tesla has also advertised “a minimum of RM20,000 in savings” if buyers book now, meaning it anticipates prices rising by at least that amount in 2026.
Meanwhile, GWM Malaysia COO Roslan Abdullah told Berita Harian we could see as much as a 100% increase, given that customers are expected to bear the brunt of the reinstated import tax (10 to 30% of the car’s price) and excise duty (50 to 100%). Compounding matters is the fact that road tax will also be reapplied to EVs starting next year.
Tax incentives will remain for CKD locally-assembled EVs until the end of 2027, which could even see a reduction in prices as the current CBU RM100,000 floor price will be removed for these cars. Leading the charge are the national carmakers – Proton has started production at its EV plant in Tanjong Malim, while Perodua will be launching its indigenously developed and produced model by the end of the year.
Aside from these two firms, most mainstream brands have committed to producing cars locally, with the exception of BMW and Tesla. The latter is part of the BEV Global Leaders programme that grants its own set of privileges, including the ability to acquire an approved permit (AP) without the need for a local partner.
Some brands, such as Volvo and Mercedes-Benz, already produce at least some of their EVs in Malaysia and should see no price increases into the new year. However, others such as BYD and Xpeng expect to only start vehicle production in the second half of 2026, so prices of their cars are expected to go up, at least for several months.
Looking to sell your car? Sell it with Carro.
It was good while it lasted. Now back to square one give tongkat to local company at the expense of the rakyat
“Tax incentives will remain for CKD locally-assembled EVs until the end of 2027, which could even see a reduction in prices as the current RM100,000 floor price will be removed for these cars.” The current RM100,000 floor price is for CBU and not for CKD EVs.
It will be interesting to see how the other EV vendors will respond to the “charge” by Proton and Perodua. Tan Chong Motors has announced that they will be assembling the TQ Wuling Bingo, and perhaps BYD would bring in their ATTO 1 when their Tg Malim plant is online. All this competition could only mean more affordable EV for the affluence challenged Rakyat. I can only dream about EVs priced like they are in China.
majulah Tan Chong being so foresighted to be one of the first local company plan for local assembly of china EV. all those who bashed TC previously (kinta kunte) could come in to apologize.
Habislah Tesla
US cars EV or ICE or hybrid no tariffs right?
Have you seen the news that Tesla Malaysia will jack up prices next year, or even watch one of the video?
Whoever owns a good branded EV now all smiling. The price hike will cover their cars depreciation. Meaning they will be driving an EV for free. Untung
but but EV
– EV cannot charge battery above 90% will damage battery
– drive above highway speeds the range will halve drop siginficant
– range anxiety sets in when charge drops below 30%
so real world usage most drivers will do around ~150km range between charges do u agree EV fanboys?
Don’t tell something that everyone ald knew
jajaja…in ur dream. look how many ev otr. so pity few. look at petrol price who need ev? look how many condo in KL, and adding on, condo resident drive ev? no 2nd hand dealer accept ev now. go ask ask see.
From What i gather US cars will be imported tariff free.
For sure US will get exemption for their Tesla. If increased 30-100% tax for CBU EV cars, Trump will definitely slap another round of tariffs to Malaysia and it would impact entire nations economy. On the other hand, guess Chinese EV maker will struggle to sell their cars here except for those managed to quickly setup their plant here for CKD, although just assembling steering and wheels to qualify for CKD status. Either way, I wonder how would China retaliate to this move by PMX as this would definitely upset the largest EV production country in the world.
Anyways, I expect a surprise by end of Dec 2025 when the govt would suddenly extend the tax free holiday until end of 2026. Otherwise how to achieve 15% EV adoption rate by 2030? Currently it’s still around 9%
Then how come heard that Tesla Malaysia will jack up prices for CBU Tesla cars? Have you read the news recently? Have you watch video recently? Seems you didn’t actually, yet you just come to conclusion and say this, very naive. And also is too early to say all EV brands will struggle to sell their cars. Don’t be too naive first.
Guess you didn’t read the news of Tesla Malaysia giving RM13k discount for their entry level Model 3 starting from 3rd October 2025. The news of “price hike” is just to trick buyers into getting an EV before the year end. Many buyers were tricked previously and then the govt decided to extend the EV tax break eventually towards year end.
the trick here is where the cars were manfuracterer. e.g. tesla made in china may not be hit by malaysian tariff.
It applies to all CBU EVs being sold here, regardless made in China or else where as long as it’s fully imported. China EV sellers will have the biggest impact unless they’re fast enough to setup CKD plants here locally before Jan 2026, which is impossible for most of them except a few brands.
Kasi pre-reg a healthy amount of stocks before 1st January 2026 while waiting for CKD factory to be ready. Just that after 2027, what would be the direction? The country’s automotive industry lacks proper road map and this doesn’t help the manufacturer in terms of long term planning. Kalau asyik ada dasar protectionism, rakyat is the one who suffer in the long term.
Govt seems to have forgotten that if more people buy EVs then less petrol will be used. This leads to reduction in petrol subsidy which can help the B40 group. So why not encourage EV purchases as it reduces financial burden of maintaining a petrol subsidy by the Govt.
I think it will be extended again at last minute.
EV industry shouting,just trying to get people to buy these 2 months.
No choice but to extend, if not the EV industry collapses again on the weight of Budi95.
No other reasonable conclusion when government reduces petrol price and also increases EV price .
So the government will extend the duty free period. Simple.
Learning from hybrid days, no plan to trap in one till I’m very certain it won’t turn to shit
the irony now is you should “trap” yourself by buying EV now because if dont buy now the price will go up soon
imho, i think Government shld extend the exemption period, let the EV market be more mature 1st and build up confident of local consumer to move forward to EV car instead of ICE car.
With the current price of EV definitely beneficial to those who intend to try EV. Out of sudden, Government decided not to extend, it will hold back lots of potential customers. This sure will backfire the sales of EV next year.
Furthermore, our charging station infra also not fully well established and covered, while the tax exemption been pull out at this moment surely will impact on the EV sales……hope MAA can re-negotiate with government again to remain the exemption period until end of 2027….