Budget 2023

  • Budget 2023: CBU EVs in Malaysia now tax free until end-2025; CKD exemption until December 31, 2027

    Budget 2023: CBU EVs in Malaysia now tax free until end-2025; CKD exemption until December 31, 2027

    Although it wasn’t mentioned during finance minister and prime minister Datuk Seri Anwar Ibrahim’s Budget 2023 speech earlier this evening, there are updates related to electric vehicle (EV) policies in the retabled budget. These were included in the touch points that were released later in the evening.

    The current import duty and excise duty exemption for fully-imported (CBU) EVs will now be extended for yet another year to December 31, 2025. It was originally set to end in December 31, 2023, before being extended in the first tabling of Budget 2023 to December 31, 2024.

    That’s not all. The excise duty and sales tax exemption for locally-assembled (CKD) EVs has also been extended – it is now in place until December 31, 2027, two years more than the original deadline, which was December 31, 2025.

    Likewise, the import tax exemption period for components used in local CKD assembly of EVs. Originally set to run until December 31, 2025, it has been extended by two years to December 31, 2027.

    As announced in the first tabling of the budget last October, the government is providing manufacturers of EV charging equipment 100% income tax exemption from year of assessment 2023 to 2032. It will also offer these manufacturers 100% investment tax allowance (Elaun Cukai Pelaburan) for a period of five years.

     
     
  • Budget 2023: Extra lanes for PLUS in Johor, Senai Desaru Highway; road upgrades in Pahang, Melaka, N9

    Budget 2023: Extra lanes for PLUS in Johor, Senai Desaru Highway; road upgrades in Pahang, Melaka, N9

    Malaysia’s revised Budget 2023 is currently being tabled by prime minister Datuk Seri Anwar Ibrahim in parliament and as usual, we’ll be focusing on automotive- and transport-related matters.

    Anwar, who is also finance minister, named a list of roads and highways that will receive upgrades. For highways, the PLUS North South Highway stretch from Yong Peng Utara to Senai Utara will be upgraded from four lanes to six in stages, and the cost is RM525 million. Also in Johor, the Senai Desaru Expressway to Pengerang will be getting an extra overtaking lane.

    The PM also mentioned a new road from Habu to Tanah Rata in Cameron Highlands, Pahang (RM480 million), upgrades for Jalan Tun Hamzah to the Semabok intersection at Lebuh AMJ in Melaka (RM300 million) and a road/bridge over Sungai Sepang to connect Bukit Pelandok, Port Dickson and Sungai Pelek, Sepang (RM160 million).

     
     
  • Budget 2023: Gov’t to absorb driving test fees for B2 motorcycle, taxi, bus and e-hailing PSV categories

    Budget 2023: Gov’t to absorb driving test fees for B2 motorcycle, taxi, bus and e-hailing PSV categories

    Malaysia’s revised Budget 2023 is currently being tabled by prime minister Datuk Seri Anwar Ibrahim in parliament and as usual, we’ll be focusing on automotive- and transport-related matters.

    Anwar, who is also finance minister, said that the government will absorb license test fees for B2 motorcycle, taxi, bus and e-hailing categories. This is good news for the majority of motorcycle riders (B2 is for bikes below 250cc) as well as those applying for PSV licenses. However, it’s not new. In the original tabling of Budget 2023 by the previous administration in October last year, this same point was proposed.

    The B2 license test fee is currently set at RM17 for Part 1 and RM20 for Part 2 (which includes rental of test motorcycles and use of the test circuit). Most driving schools charge somewhere between RM500 to RM800 for taking the B2 motorcycle licence, including course fees, training sessions and hire of test bikes.

     
     
  • Budget 2023 – all auto and transport-related points

    Budget 2023 – all auto and transport-related points

    Malaysia’s revised Budget 2023 (Bajet 2023) is presently being tabled by finance minister and prime minister Datuk Seri Anwar Ibrahim in parliament. As with previous editions, we will be monitoring his speech for any automotive- and transport-related matters.

    The original tabling of Budget 2023 by the previous administration in October 2022 brought the announcement that fully-imported (CBU) electric vehicles would be exempt from import and excise duties until December 31, 2024, an extension of a year from the previous end date of December 31, 2023.

    More EV incentives could be announced today, given the broad hints that have already come about on the matter. Last month, natural resources, environment and climate change minister Nik Nazmi Nik Ahmad said that the government intends to offer additional EV incentives, and earlier this week minister of international trade and industry Tengku Datuk Seri Zafrul Tengku Abdul Aziz said that proposed incentives had been submitted to the finance ministry.

    Also expected to be included in the revised budget is the announcement of a targeted fuel subsidy, which Anwar has said is a topic he wants to address as quickly as possible.

    In addition to automotive-related matters, we’ll also be looking out for any public transport and infrastructure news. Live updates on these will be posted here, so stay tuned.

    LIVE UPDATE POINTS

    In his speech, Anwar said there was a pressing need to plug leakages from wastage as well as irregular payments and collections, something highlighted in the Auditor General’s reports for 2020 and 2021. The reports revealed that there was a leakage of almost RM3 billion, resulting in the loss of public money. One example of this is in the under-collection of vehicle import duty, where the government has lost RM72 million due to a weak import duty collection process.

    In addition, there is also a significant leakage in the implementation of diesel subsidies – it is estimated that nearly RM10 billion worth of diesel subsidies were misappropriated last year.

    Absorbing the cost of licence tests

    • The government will bear the cost of riding test for B2 motorcycle category (below 250 cc)
    • It will also absorb the cost for taxi, bus and e-hailing licence PSV test fees

    Electricity tariffs

    • Electricity tariffs have been maintained for all domestic consumers and SME businesses, but those for all large companies (except those in the food and agriculture sector) have been increased. This means that there will be no additional cost impact for charging an EV at home

    Airport upgrades

    • The government will expand and improve the capacity of Penang International Airport and Subang Airport

    Road network projects

    • RM2.7 billion will be allocated to maintain and upgrade federal roads
    • RM1.5 billion will also be provided to upgrade rural roads and build new ones
    • RM480 million to construct a new road from Habu to Tanah Rata, Cameron Highlands, Pahang
    • RM300 million to upgrade Jalan Tun Hamzah to the Semabok intersection at Lebuh AMJ in Melaka
    • RM160 million to build a road and bridge across Sungai Sepang to connect Bukit Pelandok, Port Dickson and Sungai Pelek in Sepang
    • The road network to Pengerang, Johor will be improved with a new overtaking lane on Senai-Desaru Highway
    • RM525 million to widen the Johor stretch of PLUS from Yong Peng Utara to Senai Utara to six lanes

    On the issue of potholed roads, district JKR offices will speed up the paving of federal road damage as well as other urgent repairs based on complaints received from the people. RM100,000 will be allocated to each district for this purpose.

    The government says it will also continue and expedite the implementation of the Pan Borneo Sabah highway and the Sarawak-Sabah Link Road, which is estimated to involve a total cost of RM20 billion.

    Road lighting infrastructure to be improved

    • A total of RM50 million will be provided to install street lights, especially in high accident areas

    Public transport

    • My50 travel pass monthly subscription initiative will be continued, to benefit nearly 180,000 users
    • myBAS50 unlimited travel pass pilot project to be introduced in Johor Bahru for the SBST programme
    • RM150 million to expand the implementation of the SBST programme to Melaka, Kuching and Kota Kinabalu

    MRT3

    • The government is aiming to bring down the development cost for the project from the estimated RM50 billion it is at right now to under RM45 billion.

    Electric vehicles (EV)

    • Import and excise duty exemption for fully-imported CBU EVs extended to December 31, 2025 (two-year extension from end-2023, previously extended to end-2024 in first tabling of Budget 2023)
    • Excise duty and sales tax exemption for locally-assembled CKD EVs extended to December 31, 2027 (two-year extension from December 31, 2025)
    • For manufacturers of EV charging equipment: 100% income tax exemption from YA 2023 to 2032
    • For manufacturers of EV charging equipment: 100% investment tax allowance (Elaun Cukai Pelaburan)
     
     
  • Budget 2023 to be retabled by finance minister, PM Anwar Ibrahim at 4pm today – stay tuned for updates

    Budget 2023 to be retabled by finance minister, PM Anwar Ibrahim at 4pm today – stay tuned for updates

    Malaysia’s revised Budget 2023 (Bajet 2023) will be tabled by finance minister and prime minister Datuk Seri Anwar Ibrahim in parliament at 4pm today. As with previous editions, we will be monitoring the speech by the PM for any automotive- and transport-related matters.

    The original tabling of Budget 2023 by the previous administration in October 2022 brought the announcement that fully-imported (CBU) electric vehicles would be exempt from import and excise duties until December 31, 2024, an extension of a year from the previous end date of December 31, 2023.

    More EV incentives could be announced in the retabled budget, given the broad hints that have already come about on the matter. Last month, natural resources, environment and climate change minister Nik Nazmi Nik Ahmad said that the government intends to offer additional EV incentives, and earlier this week minister of international trade and industry Tengku Datuk Seri Zafrul Tengku Abdul Aziz said that proposed incentives had been submitted to the finance ministry.

    Also expected to be included in the revised budget is the announcement of a targeted fuel subsidy, which Anwar has said is a topic he wants to address as quickly as possible.

    In addition to automotive-related matters, we’ll also be looking out for any public transport and infrastructure news. We will have live updates here when the time comes, so stay tuned.

     
     
  • Budget 2023: free PSV and B2 Motorcycle Licence test

    Budget 2023: free PSV and B2 Motorcycle Licence test

    Included in Malaysia’s Budget 2023 is the abolition of the Public Service Vehicle (PSV) and B2 motorcycle licence test fee. Currently set at RM17 for Part I of the B2 test and RM20 for Part II (which includes rental of test motorcycle and use of the test circuit), this fee is now abolished, said Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz during his budget speech.

    At the present moment, most driving schools charge somewhere between RM500 to RM800 for taking the B2 motorcycle licence, including course fees and training sessions, including hire of test bike. The cost of the full B licence ranges from between RM900 to RM1,300, depending on location.

    The PSV licence test fee, which applies to applicants for taxi, bus and e-hailing services, will also be abolished. This is to assist the B40 group in earning a living from that transportation sector.

     
     
  • Budget 2023: CBU EVs in Malaysia tax free until end 2024; AP fees exempted – even cheaper EVs soon?

    Budget 2023: CBU EVs in Malaysia tax free until end 2024; AP fees exempted – even cheaper EVs soon?

    The current import duty and excise duty exemption for electric vehicles will be extended for another year, as revealed by finance minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz during the tabling of Budget 2023.

    During last year’s Budget tabling, it was announced that EVs would be exempt from import and excise duties, with the exemption period being up to December 31, 2023 for fully-imported (CBU) EVs, and up to December 31, 2025 for locally-assembled (CKD) EVs.

    With Budget 2023, Zafrul said the exemption for CBU EVs will be extended for another year to December 31, 2024 – no mention was made about CKD EVs. In any case, this is surely good news for car companies here who are planning on bringing in EV models soon as well as car buyers looking for a zero-emission vehicle.

    Budget 2023: CBU EVs in Malaysia tax free until end 2024; AP fees exempted – even cheaper EVs soon?

    The Malaysian Automotive Association (MAA) previously said it wanted the EV incentives to go on for 10 years, but it looks like they’ll have to settle for an extra one and see what comes next in Budget 2024.

    Car importers who are looking to bring in EVs will also be incentivised to do so because they will not need to pay the approved permit (AP) fee. This is new and could potentially make EVs even cheaper, provided companies pass the savings from not paying the AP fee on to customers. The AP fee exemption will be in effect from January 1 to December 31, 2023, and again, only applies to EVs.

     
     
  • Budget 2023: RM20 million for drag strips in Malaysia

    Budget 2023: RM20 million for drag strips in Malaysia

    During his Budget 2023 speech, Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz announced the Malaysian government would allocate RM20 million to build drag racing strips in the country. However, there were no details on where the allocation would be spent or for how many drag strips.

    This budget announcement follows Prime Minister Datuk Seri Ismail Sabri Yaakob’s statement in August, where he said there would be a government proposal to construct purpose-built drag circuits for every state in Malaysia.

    “At this point there are two drag circuits built, that is in Terengganu and Melaka,” said the PM during the RXZ Members 4.0 2022 gathering that was held at the Terengganu International Drag Strip in Gong Badak.

    Ismail added when the drag strips were completed, it would be an opportunity for the youth to be seriously involved in motorsports through proper channels.

     
     
  • Budget 2023 – all auto and transport-related points

    Budget 2023 – all auto and transport-related points

    Malaysia’s Budget 2023 (Bajet 2023) will be tabled by finance minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz in parliament at 4.00 pm today, three weeks earlier than the originally scheduled date of October 28. As always, we will be monitoring the finance minister’s speech for any automotive-related matters.

    Last year’s Budget tabling was particularly interesting for the local EV industry, with the government announcing at the time that EVs would be exempted from import and excise duties as well as road tax for a limited time.

    This year, expectations are that these EV incentives be extended beyond their original deadlines – 100% duty exemption for CBU EVs up to December 31, 2023, and 100% duty exemption for CKD EVs up to December 31, 2025. The ministry of international trade and industry (MITI) said previously that it had proposed more EV incentives to be included in Budget 2023, but we’ll have to wait until later to find out.

    In addition to automotive-related matters, we’ll also look out for public transport and infrastructure news. Live updates will be posted here, so stay tuned. What are you hoping for in this year’s Budget?

    MyPSV programme

  • Government will bear the cost of licenses for taxi, bus and e-hailing
  • Government will bear the cost of riding test for B2 motorcycle category (below 250 cc)

    Public transport – stage buses

  • RM180 million for stage buses in Melaka, Kota Kinabalu and Kuching
  • Replacement for 18 MARA stage buses in Kedah
  • Public transport – subsidised My50 monthly travel pass extended for one year

    OKU assistance – RM10 million in e-hailing vouchers

    One-off grant for SMEs and registered taxi drivers – RM1 billion allocated

    50% excise duty exemption for CKD vehicles used in the tourism industry

    Flood prevention – Rancangan Tebatan Banjir, a long-term strategy (till 2030), RM15 billion allocated

    “Green technology” acquisition and setting up EV infrastructure, RM330 million allocated

    Collaborative Research in Engineering, Science and Technology centre (CREST) – to develop apps based on RFID and Bluetooth for the automotive industry. RM10 million allocated

    RM510 million to improve road network to Pengerang, Johor

  • Overtaking lane on Senai-Desaru Highway
  • Upgrades to the PLUS at Senai Utara-Pandan
  • Motorsport – RM20 million to build drag racing tracks

    Infrastructure projects – RM16.5 billion allocated

  • Pan Borneo Highway (completing soon in Sarawak, by 2024 in Sabah)
  • Central Spine Road
  • RTS Link
  • ECRL
  • Gemas-JB double-track project
  • Repair and maintenance of government assets – RM11.4 billion allocated, including for federal roads

    MRT3 – RM50.2 billion allocated

  • Completes KL’s rail network, 50.8 km route
  • Phase 1 (2028), Phase 2 (2030)
  • RM3.3 billion expected to be spent in 2023
  • Rural infrastructure

  • Roads and village connection, RM1.5 billion allocated
  • 500 km of roads, to benefit 110,000 people
  • RM123 million for kampung street lamps, 6,800 units
  • RM54 million to build 85 new bridges
  • RM5.2 billion for state roads under MARRIS, state governments can access this fund
  • BRT network for Johor, RM80 million allocated

    Gentari by Petronas

  • Installation of solar panels at government and private facilities
  • 500 units of EV chargers nationwide
  • TNB – RM165 million allocated

  • Solar rooftops and EV chargers
  • Electric vehicles (EV)

  • Import and excise duty exemption for CBU EVs extended to December 31, 2024 (one-year extension)
  • Approved permit (AP) fee exemption for the import of EVs, till December 31, 2023
  • For manufacturers of EV charging equipment: 100% income tax exemption from YA 2023 to 2032
  • For manufacturers of EV charging equipment: 100% investment tax allowance (Elaun Cukai Pelaburan)
  •  
     
  • Budget 2023 set to be tabled this Friday, October 7

    Budget 2023 set to be tabled this Friday, October 7

    Law minister Datuk Seri Wan Junaidi Tuanku Jaafar has confirmed that the Budget 2023 (Bajet 2023) is set to be tabled by finance minister Datuk Seri Tengku Zafrul Abdul Aziz at 4pm on Friday, October 7, as scheduled, the Malay Mail reports.

    He said that this was based on the information as of last night. “I was told the budget will be presented on October 7, and if there are any changes after that, I don’t know,” he said in response to questions about rumours indicating that parliament would be dissolved before Budget takes place this Friday.

    The decision to bring forward Budget 2023 by three weeks from its original date was made at the end of August. Speculation is rife that the move will allow parliament to be dissolved several days after the tabling of the budget, paving the way for a general election to be called.

    However, prime minister Datuk Seri Ismail Sabri Yaakob said in August that the decision to bring forward the tabling of Budget 2023 was not unusual, as it had been done before. “This is normal. During Pak Lah’s (former prime minister Tun Abdullah Ahmad Badawi) time, the Budget was tabled in September,” he said.

    Budget 2023 set to be tabled this Friday, October 7

    In July, Tengku Zafrul indicated that Budget 2023 will focus on more sustainable subsidy management and strengthening the country’s resilience against future shocks. From an automotive-related perspective, the biggest news in last year’s budget were the tax and duty exemptions announced for electric vehicles (EVs).

    It could be that Budget 2023 will see further developments on this front, possibly on enhancing the growth of the charging infrastructure as well as that concerning regulations. Last month, the ministry of international trade and industry (MITI) said it had proposed that more EV incentives be included in this year’s budget.

    We’ll be covering all auto and transport-related matters that will be presented in Budget 2023, so be sure to check in again on Friday for all the latest news.

     
     
  • MITI is proposing more EV incentives for Budget 2023

    MITI is proposing more EV incentives for Budget 2023

    The ministry of international trade and industry (MITI) has proposed that more EV incentives be included in Budget 2023, which is set to be tabled next month on October 7. This was revealed by MITI secretary general Datuk Lokman Hakim Ali during the launch of the Perodua Ativa Hybrid subscription programme today.

    “Let me just take this opportunity to share [something] with you. This morning, at an EV task force meeting, MITI as well as various ministries, agencies, industry players and associations have agreed that we should place [more] emphasis in building efficient and quality infrastructure for charging stations,” said Lokman.

    “We realised the need to ensure the regulatory process is facilitative enough towards ensuring a conducive environment for the EV industry to thrive. In fact, MITI has actually put up a few proposals for Budget 2023; certain incentives to ensure that local industry players are be able to compete in the EV ecosystem,” he added.

    During the tabling of Budget 2022 last year, it was announced that EVs would be completely exempt from import and excise duties. The exemption runs from January 1, 2022 until December 31, 2023 for fully-imported (CBU) EVs, while it’s until December 31, 2025 for locally-assembled (CKD) EVs. Road tax for CBU and CKD EVs are exempt until December 31, 2025 too.

    Several car companies have since begun offering EVs priced to take advantage of these incentives, with more set to join the mix. The Malaysian Automotive Association (MAA), which represents car companies in our country, are seeking an extension of the exemption for up to 10 years to further promote the growth of the local EV market. What sort of EV incentives are you looking forward to in Budget 2023?

     
     
  • Malaysia should abolish road tax in Budget 2023 to reduce burden on rakyat, as it is “tax on tax” – senator

    Malaysia should abolish road tax in Budget 2023 to reduce burden on <em>rakyat</em>, as it is “tax on tax” – senator

    Unless you happen to have a car with a large engine displacement, any thought of road tax only comes to mind when it’s time to pay the annual fee, and even then, all the attention is on how much car insurance costs. After all, a yearly road tax of RM20 for a vehicle with a 1.0 litre engine or RM70 for a 1.3 litre engine (RM90 if it’s a 1.5 litre mill) isn’t really going to dent your wallet all that much.

    Still, every ringgit counts, and running with that idea, senator Muhammad Zahid Md Arip has suggested to the government that it should abolish vehicle road tax in order to ease the burden on the people. He said this is because the system currently in use is based on the concept of ‘tax on tax,’ as Sinar Harian reports.

    He said that at present, vehicle owners are faced with a multi-layered system that taxes them via import duty, excise tax, SST and road tax. “Given that they have to pay taxes on multiple fronts, people, especially those living in the Klang Valley, seem to be under siege,” he said.

    He added that most motorists in the Klang Valley have to use routes that are almost always subject to toll on a daily basis, hence the call to abolish the road tax in the upcoming budget.

    Malaysia should abolish road tax in Budget 2023 to reduce burden on <em>rakyat</em>, as it is “tax on tax” – senator

    “Malaysians cannot continue to be burdened with this ‘tax on top of tax’ and Budget 2023 is the best opportunity for the prime minister to make the people happy. I understand that the 2023 Budget consultation is currently underway, and I hope the government will consider this proposal,” he said in a statement earlier this week.

    He said the proposal would be beneficial to the rakyat and the government as a whole. “The government can actually follow the United Kingdom, which has abolished road tax since 2015 and only imposes vehicle excise duty (VED) on vehicle owners, in implementing a new system,” he said.

    “In order to cover the loss of revenue due to the elimination of this road tax, the government can consider reducing the fuel subsidy. This method is actually fairer to the people and the government, because it is aimed directly at eligible users, especially from the B40 group,” he explained.

    Obviously, not having to pay road tax would benefit motorists (we can see those with 4.0 and 5.0 litre rides nodding happily in agreement), but there surely cannot be a free lunch for everyone. What do you think of the senator’s idea of implementing a VED system to replace the current – and outdated – road tax system? Share your thoughts with us in the comments section. As for the current road tax structure, here’s a detailed explanation of how it works.

     
     
  • Budget 2023 set to be tabled 3 weeks earlier, on Oct 7?

    Budget 2023 set to be tabled 3 weeks earlier, on Oct 7?

    It has been revealed that Budget 2023 (Bajet 2023), which was scheduled in the Parliament calendar for October 28, is now reportedly set to be presented earlier. The Budget is now expected to be tabled by finance minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz three weeks earlier, on October 7, according to The Star.

    The decision to bring forward Budget 2023 was reportedly made at a Cabinet meeting earlier this morning (August 26), with prime minister Datuk Seri Ismail Sabri Yaakob informing the Cabinet of the shift. The move to bring Budget forward is regarded as an indication that the general election could possibly be held soon.

    The decision to hold an earlier Budget is being made ahead of a special Umno meeting tomorrow (August 27), where party leaders are expected to push for Parliament to be dissolved as soon as possible, paving the way for elections to be called.

    However, the prime minister said that decision to bring forward the tabling of Budget 2023 is not unusual, as it has been done as early as September previously. “This is normal. During Pak Lah’s (former prime minister Tun Abdullah Ahmad Badawi) time, the Budget was tabled in September,” Ismail Sabri said earlier this evening.

    Budget 2023 set to be tabled 3 weeks earlier, on Oct 7?

    Asked by reporters to confirm the new date, he said to wait for minister in the prime minister’s department (parliament and law), Datuk Seri Dr Wan Junaidi Tuanku Jaafar, to announce it.

    Last month, Tengku Zafrul had indicated that Budget 2023 will focus on more sustainable subsidy management and strengthening the country’s resilience against future shocks. From an automotive-related perspective, the biggest news on this front in last year’s Budget was with the tax and duty exemptions announced for electric vehicles (EVs).

    Ahead of this year’s edition, what sort of auto-related updates – as well as that for public transport and infrastructure – would you want to see being incorporated in this year’s Budget? Share your thoughts and suggestions with us in the comments section.

     
     
 
 
 

Latest Fuel Prices

PETROL
RON 95 RM2.05 (0.00)
RON 97 RM3.47 (0.00)
RON 100 RM5.00
VPR RM6.40
DIESEL
EURO 5 B10 RM2.15 (0.00)
EURO 5 B7 RM2.35 (0.00)
Last Updated May 16, 2024