Proposed incentives for EVs in Malaysia submitted to MoF, to include extension of tax exemption – MITI –

Proposals for the further stimulation of the electric vehicle (EV) market in Malaysia have been submitted to the ministry of finance (MoF), according to The Star. These proposals will include the extending of tax exemptions for EVs sold in the country, minister of international trade and industry Tengku Datuk Seri Zafrul Tengku Abdul Aziz said.

“We have submitted our proposals, and we hope the finance ministry will continue to support the EV agenda,” said the minister, who also attended the National Electric Vehicle Task Force meeting at MITI with EV stakeholders, according to the report.

The first tabling of Budget 2023 saw the announcement of import and excise duty exemptions for fully imported (CBU) EVs until December 31, 2024, which was itself extended from the prior end date one year earlier at December 31, 2023 that was put in place by the previous government at the tabling of Budget 2022.

The current tax exemption has been stimulating the growth of the EV market in Malaysia, said Volvo Car Malaysia MD Charles Frump. “The current incentive system, with the no sales tax for EVs, has been helpful for manufacturers and for the development [of EVs]. So, this is sufficient to really drive electrification in Malaysia. If we just continue [under the re-tabled Budget 2023], we can be on the right path,” Frump said.

Sales of electric and hybrid vehicles accounted for 2.77% of the total industry volume in 2022, according to Tengku Zafrul. “We received the latest report that for 2022, the number of EVs and hybrid vehicles was a huge jump from the year before. To ensure the momentum continues, we must also make sure that the ecosystem is ready, including the charging stations,” he said.

In terms of fully electric vehicles, sales of EVs in Malaysia grew to 2,631 units last year, up from just 274 units sold in 2021, or a gain of 860%, according to the Malaysian Automotive Association (MAA).

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