In accordance with the Malaysian finance ministry‘s ‘Fiscal Outlook and Federal Authorities Income Estimates‘ report, whole authorities income from automobile import duties, excise duties and gross sales tax this yr is estimated to be RM11.1 billion, and that is anticipated to rise 4.5% to RM11.6 billion subsequent yr.
The 2025 estimates will be damaged down into RM630 million in import duties, RM3.97 billion in CKD excise duties (vehicles plus bikes), RM3.27 billion in CBU excise duties (vehicles), RM2.11 billion in CKD gross sales tax (passenger autos plus industrial autos) and RM1.13 billion in CBU gross sales tax (additionally passenger autos plus industrial autos).
Additionally supplied are the 2026 estimates, and you may see from the desk beneath that whereas import responsibility income shouldn’t be anticipated to alter a lot and excise responsibility income is barely anticipated to develop by 2.3%, the federal government expects to gather 10.4% extra gross sales tax subsequent yr.
One factor that may change come subsequent yr is that fully-imported (CBU) EVs will start contributing to import and excise responsibility revenues. At the moment, CBU EVs are import- and excise-duty free, however they’re topic to gross sales tax, and EVs nonetheless make up a really small piece of the Malaysian pie.
So the projected 10.4% rise in gross sales tax income has us questioning. It’s potential that the comparatively excessive quantum (round RM3 billion) and projected enhance is as a result of gross sales tax is utilized after all of the duties, which creates a compound impact. One other potential clarification is a forecasted enhance in whole trade quantity (TIV) for 2026 over 2025.
Now, whereas RM11 billion in income could sound like loads, keep in mind that the federal government usually has to spend round RM20 billion yearly in RON 95 petrol subsidies (Budi Madani RON 95 minuses simply RM2.5 billion-RM4 billion from that determine). So, low-cost vehicles or low-cost petrol? Choose one, as a result of you possibly can’t have each!
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