Thursday 28 Mar 2024
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KUALA LUMPUR (Oct 29): The Chartered Tax Institute of Malaysia (CTIM) has hailed the government’s decision to extend the 100% sales tax exemption for passenger vehicles assembled in Malaysia, and the 50% discount for imported vehicles, until June 30. 

“Malaysians can benefit from this extension of sales tax incentives to purchase locally assembled passenger vehicles and imported vehicles at a reduced price,” said CITM president Farah Rosley.

“This will continue to encourage the purchase of new motor vehicles and support the automotive industry, which includes a significant number of small medium enterprises (SMEs) in the supply chain,” she said in a statement. 

Farah said Budget 2022 covered a wide spectrum in terms of tax deductions and incentives for businesses, employment, women’s development, cost of living, rural development and others that will help sustain and spur economic activities, rebuild economic resilience, and catalyse the reform agenda against the backdrop of the prolonged Covid-19 pandemic.

Noting that there were no new tax regimes in Budget 2022, Farah said: “This is in line with what the government had said that now is not the time to introduce new taxes, as the economy is still in repressive mode.”.

Farah said it was expected that the government will look at ways to increase tax revenue through diversifying and broadening the tax base.

Some of the measures announced in Budget 2022 include sales tax on low value goods received from outside Malaysia, which are sold by online merchants and delivered to consumers in Malaysia via air courier services.

Service tax, meanwhile, will be levied on delivery of goods provided by service providers including e-commerce platforms, except for food and beverage delivery services, as well as logistics services.

“At first glance, the measures will have an initial impact on online consumers, as well as companies other than SMEs and companies with foreign investments. How it affects the behaviour of taxpayers remains to be seen,” said Farah. 

See more Budget 2022 highlights here.

Edited ByS Kanagaraju
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