Excise duty for 2WD, 4WD not exceeding 1,500cc now at 60%


PUTRAJAYA: The government has agreed to streamline the excise duty rate for two- and four-wheel drive vehicles with an engine capacity not exceeding 1,500 cc to 60 per cent with immediate effect.

Customs Department director-general Datuk Subromaniam Tholasy said the decision to reduce the excise duty from 65 per cent (effective April 1) to 60 per cent was made after considering the high public demand for completely built-up (fully imported) vehicles.

“In the temporary transition period to gazette it effective tomorrow, all vehicles involved will be exempted from the excise duty exceeding 60 per cent.

“In this respect, the vehicle price should be maintained and vehicle manufacturers cannot raise the price with the reason of higher excise duty at 65 per cent which had been gazetted through 2017 Excise Duty Order on March 31,” he said in a statement, today.

Subromaniam said the earlier decision to standardise the excise duty at 65 per cent was due to several reasons. One of which was the fact that the rate was reasonable compared to passenger vehicles with an engine capacity not exceeding 1,800cc at 75 per cent.

“The decision to set the new excise duty of 65 per cent is not to increase revenue but more to find middle rate of between 65 per cent and 75 per cent,” he said.