KUALA LUMPUR: Proposals to further stimulate the electric vehicle (EV) market in Malaysia have been submitted to the Finance Ministry, says Tengku Datuk Seri Zafrul Tengku Abdul Aziz.
The International Trade and Industry Minister said that these proposals included extending the sales tax exemption for EVs.
“We have submitted our proposals, and we hope the Finance Ministry will continue to support the EV agenda,” he said after the Volvo XC40 Recharge Pure Electric handover and vehicle charger inauguration ceremony at his ministry here yesterday.
He also attended the National Electric Vehicle Task Force meeting at his ministry with EV stakeholders.
Currently, there are import and excise duty exemptions for battery electric vehicles (BEVs).
The exemptions will last until Dec 31, 2025, for locally assembled models, while incentives for CBU (completely built unit) models will stop at the end of this year.
In Budget 2023 that was tabled last October just before Parliament was dissolved, there was a proposal to extend the exemptions for CBUs by another year.
Volvo Car Malaysia managing director Charles Frump said the current sales tax exemption has been stimulating the growth of EVs in the country.
“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,” he added.
Frump said the public response to EVs has been encouraging.
“When we opened the order book for the XC40, we sold 100 cars on the very first day, and that was only the first batch. The demand for both the XC40 and C40 has gone beyond what we can supply at the moment. Really fantastic response.”
Tengku Zafrul said the number of EVs and hybrid vehicles reached 2.77% of the total industry volume (TIV) in 2022.
“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 2021, it was reported that only 274 EVs were sold here, from a grand total of 508,911 cars, or a paltry 0.05%.
From January to May 2022, 390 EVs were sold in Malaysia, with the percentage of EVs increasing to 0.17%.
Tengku Zafrul said the government is committed to the Paris Agreement and in achieving nett zero greenhouse gas emissions by 2050.
