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PETALING JAYA: The Ministry of Finance in a circular stated today that the exemption from sales tax for the purchase of fully disassembled locally assembled passenger vehicles will not end on January 1, but will run until June 30, 2021 .
The ministry has also extended the 50% sales tax discount for brand new and used imported vehicles until June next year.
Under the sales and service tax regime, vehicles are subject to a 10% sales tax.
The tax exemption and discounts were announced as part of Penjana’s economic stimulus package last June to revitalize demand for vehicles, but it was scheduled to end on December 31, 2020.
The Covid-19 pandemic, as well as the implementation of the motion control order in March and April, has seriously affected the industry. Only 141 vehicle sales were reported in April compared to 49,935 in the same period last year.
