With the good and services tax (GST) set to be revised to 0% from 6% on June 1, Malaysian car buyers are enjoying lower vehicles prices with many companies already announcing revised price lists.
This “tax-free” period will remain in effect until the reintroduction of the sales and services tax (SST), which may put an end to the “good times.” Recently, finance minister Lim Guan Eng revealed the SST will be set at 10%, the same rate it was when it was replaced by the goods and services tax (GST) in April 2015
According to industry players, this may result in prices being pushed upwards again, even beyond GST-inclusive prices. In a report by NST, Malaysian Automotive Association (MAA) president Datuk Aishah Ahmad said, “before GST was implemented, SST was 10%. If we consider this figure, we expect the prices of vehicles to increase, post-SST. This is an easy estimate if the rate is the same.”
The MAA is expecting the government to lower the SST to be lower than GST (6%) in order to lower vehicles prices further to promote buying. “We look forward to the government’s decision on SST. When GST was implemented, car prices decreased slightly,” she noted.
Meanwhile, Perodua are unable to confirm if its vehicle prices will go up or down when the SST is implemented. Its president and CEO Datuk Aminar Rashid Salleh said it was too early to speculate on the matter, and the company will need to meet with relevant stakeholders for further details.
“We will prepare for the implementation of SST and we are awaiting the government’s decision on when it will take place,” he said. In a previous report, Tun Daim Zainuddin, head of the government’s Council of Eminent Persons, stated the return of the SST will take place within two to three months.
In light of this, will you be purchasing your vehicle within the GST-free period, or will you hold out until SST-inclusive prices are revealed?