Government mulling extension of SST exemption beyond June 30

The ongoing sales tax (SST) exemption for new cars, which is currently scheduled to expire on June 30, may soon be extended yet again, according to transport minister Datuk Seri Wee Ka Siong.

The further extension of the SST exemption period, which has already been extended thrice previously, is intended to support the local automotive industry, which has faced many challenges due to the Covid-19 pandemic, The Star reports.

“The government is currently considering the proposal to extend the exemption, and a decision will be announced soon,” Wee said in a recorded statement at the Federation of Motor and Credit Companies Associations of Malaysia (FMCCAM) annual general meeting last Saturday.

At the event, FMCCAM president Datuk Tony Khor also urged the government to extend the exemption beyond the current expiry date, echoing the calls from other industry players such as the Malaysian Automotive Association (MAA) and Perodua.

Khor said there has been delays in the delivery of vehicles, which was caused by the pandemic’s disruption to global supply chains, as well as the ongoing chip shortage issues. Extending the exemption, he said, would lead to more potential car buyers.

However, Datuk Seri Wee Ka Siong has previously said that the final decision to extend the SST exemption period will be made by the Finance Ministry.

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At the same event, Khor also proposed for the Road Transport Department (JPJ) to restructure the road tax structure, particularly for older cars. “FMCCAM is also proposing to JPJ to consider reducing the road tax by 75% for vehicles that are more than 15 years old, 50% for vehicles that are more than 10 years old, and 25% for vehicles that are five years old,” he said.

“We welcome initiatives that will help economic recovery, and we will look into the matter to see if the Transport Ministry can help facilitate this proposal,” Wee commented. “On the proposal to reduce road tax for cars that are more than 10 years old, the matter must be looked at holistically to ensure the outcome will benefit the majority.”


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