According to Malaysian Motor Traders Association (MMA), government will start calculating the OMV in a new way from 2023, which will lead to a price increase for new cars in 2023.
The new Open Market Value (OMV) will include the cost of non-manufacturing and will result in an increase of between 8% and 20% in the price of new cars, and the industry has asked the government to revert to the previous method of calculating the OMV to curb price increases for locally assembled cars.
The previous method of calculating the domestic tax did not include non-manufacturing related costs and therefore new cars were subject to a lower domestic tax.
In 2019, the former government proposed a framework for restructuring the domestic tax structure for cars, which was to be implemented in 2020, but was subsequently postponed to the end of 2022 and will come into effect in 2023.
The country resumed the sales tax on new cars from July and all new cars in the country have already been increased from July. If the government adopts the new method of calculating the domestic tax in 2023, then new cars will be subject to another hike.
