Imported cars sold in Malaysia need to pay 3 kinds of taxes!
Generally speaking, imported cars sold in the domestic market are subject to three types of taxes, namely Import Duties, Excise Duties and Sale Tax.
The import tax is 30%, while the domestic tax is 65% and the sales tax is 10%. Since the outbreak in 2020, the government has announced that imported vehicles will receive 50% of the sales tax, which means that only about 5% of the sales tax will be collected. This offer will end on June 30, 2022.
In addition, according to a message from the president of the Malaysian Automobile Dealers Association, the government will start calculating the car domestic tax in a new way from 2023, which will lead to an increase in the price of locally assembled cars in 2023.
The new OMV will include non-manufacturing costs and will result in an 8% to 20% increase in the price of locally assembled vehicles, and the industry has asked the government to revert to the previous calculation method to curb the increase in the price of locally assembled vehicles.
The previous method of calculating the domestic tax did not include non-manufacturing related costs, so locally assembled vehicles were required to pay a lower domestic tax.
The former government proposed a restructuring of the vehicle domestic tax framework in 2019, and the implementation of the vehicle domestic tax was to begin in 2020, but was subsequently postponed to the end of 2022, and will take effect in 2023.
