Deputy investment, trade and industry minister Sim Tze Tzin has said the implementation of the open market value (OMV) excise duty revision, or the PU(A) 402/2019-Excise Tax Regulations (Determination of Value of Locally Produced Goods for Excise Tax Purposes), for locally-assembled (CKD) vehicles will not affect about 90% of Malaysians, especially those from the B40 and M40 groups.
“The impact on vehicle prices will be minimal. The government will ensure affordable vehicles for the B40 and M40 groups, based on the approved tax incentives,” Sim said in response to a supplementary question from Khairil Nizam Khirudin (PN-Jerantut) in the Dewan Rakyat today (February 23, 2026), as reported by The Edge.
“Any minor impact may involve luxury branded vehicles, which could see a slight price increase. However, this does not affect buyers from the B40 and M40 groups, who generally do not purchase luxury vehicles,” he added.
The much talked about OMV/402 will be implemented in July this year after being deferred for five years and stipulates a new methodology of calculating a CKD vehicle’s OMV, which influences how much tax is to be paid and therefore, its selling price.
The revision seeks to introduce additional calculations to the equation, expanding excise duties to include non-manufacturing costs such as the sale aspect of a vehicle as well as associated elements such as marketing, administrative expenses and profit.
Prior to the deputy MITI minister’s statement, the Malaysian Automotive Association (MAA) said the OMV/402 revision would have “very little or no impact” to CKD pricing. Before that, the association estimated that the new regulations would see CKD prices be bumped up by 10% to 30%.
Sim also touched upon the New Customised Incentive Mechanism (NCM), which replaces Customised Incentives (CI) as a fixed, more transparent and fairer tax system. “Under the NCM, companies that demonstrate significant investment commitments, increase genuine local content, and contribute to vendor development and exports are eligible for higher excise duty exemptions,” he explained, The Star reported.
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Basically PH Gomen wan Msians to own cheap affordable cars. They want to keep cars cheep so everyone can buy . PH Gomen is working for all rakyat Malaysia, not only for the rich .
Nah… Government forced you to buy cheap lousy local product while keeping competing good product away from you. In Malaysia Myvi cost RM60K while the same money can buy an Altis in Japan.
Car ownership in Japan is relatively affordable for the vehicle itself, but high for maintenance, with annual costs often exceeding RM10k, particularly in the major cities. Major expenses include the mandatory once every 2 years inspection (up to RM5k), monthly parking (up to over RM750), annual vehicle tax (up to over RM12.5k for a standard car, depending on engine cubic displacement), insurance (up to over RM250 a month for comprehensive cover), and high tolls/fuel costs (up to over RM250 per month for frequent users).
I will believe you when I see the new pricing. My guess is that car price of RM150k and above will see an upward revision. In that case, it will also affect M40 group as cars like Civic and CX5 which I don’t consider as luxury car will see an increase in price
The most exciting time for car market was when badawi became PM. Car prices fell by 10-20% but instead of celebrating, existing owners complained their cars had depreciated. And car distributors put back the old price making tons more in margins. We had thai assembled cars, SUV’s in our market. Opel, chevrolet, pajero sport, isuzu suv…. China cars came in, haval and chery, volvo xc90 was RM290k. Then najib came and all disappeared. I think under badawi, no need for AP if imported from asean. We signed the asean free trade for vehicles but did not honour it. So our locally made cars suffer same tariffs if brought into neighbouring asean countries in retaliation. Cost of geely version of Proton’s E-mas is cheaper in thailand snd indonesia tells you our natioanal automotive policy is screwed up. If we want to compete, we need yo build in huge numbers and that means, a open asean market.
Malaysian loves their cars… Yeah…
In other Words Malaysia Forced to buy local substandard Product and help Proton & Perodua to sell their QVE like it or Not. Sounds Noble but in TRUTH we are being denied good affordable quality product.
gomen will again force people to buy these local trash. The way is as usual, impose high tariff on non-national brands. Gee, thanks Proton.