KUALA LUMPUR – The government is set to provide tax exemptions for electric vehicles (EVs) under Budget 2022.
During the tabling of Budget 2022 yesterday, Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz acknowledged the potential of EVs to reduce air pollution.
“Thus, to support the development of the local EV industry, the government agrees to implement exemptions towards import duties, excise duties, and sales tax for EVs.”
Additionally, he announced 100% road tax exemptions for these vehicles.
He said tax exemptions up to RM2,500 will be given to individuals for the cost of purchasing, installing, and renting facilities to charge EVs.
The move by the government to recognise the future of EVs in the automotive industry sat well with industry players.
Malaysian Automotive Association president Datuk Aishah Ahmad said these incentives to encourage the public to purchase EVs are long overdue, adding that the various exemptions would definitely spur demand for EVs.
“Currently, the import duty for completely built-up vehicles is 10%.
“But the excise duty – between 65% and 105% – is very high, so the exemptions would definitely reduce the purchase price.
“On top of that, the road tax exemptions will help buyers,” Aishah said when contacted by The Vibes.
However, she said there will have to be infrastructure in place to support a potential increase in EVs, given that it would defeat the purpose if owners find difficulty in charging their cars.
Sharing similar views, Malaysian Electric Vehicle Owners Club president Datuk Shahrol Halmi said the various tax exemptions for EVs are welcomed.
However, he pointed out that certain matters under Budget 2022 concerning EVs were not made clear – such as the length of road tax exemptions.
“EV owners are happy about the RM2,500 income tax rebate for installing charging equipment at home.
“That will be helpful, but there is no specific incentive for public charging infrastructure and we hope the government will look into that,” Shahrol said.
He said charging infrastructure would not only be important for EV users, but would also create jobs and skills for the new green economy. – The Vibes, October 30, 2021
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