Budget 2023: CBU EVs in Malaysia now tax free until end-2025; CKD exemption until December 31, 2027

Budget 2023: CBU EVs in Malaysia now tax free until end-2025; CKD exemption until December 31, 2027

Although it wasn’t mentioned during finance minister and prime minister Datuk Seri Anwar Ibrahim’s Budget 2023 speech earlier this evening, there are updates related to electric vehicle (EV) policies in the retabled budget. These were included in the touch points that were released later in the evening.

The current import duty and excise duty exemption for fully-imported (CBU) EVs will now be extended for yet another year to December 31, 2025. It was originally set to end in December 31, 2023, before being extended in the first tabling of Budget 2023 to December 31, 2024.

That’s not all. The excise duty and sales tax exemption for locally-assembled (CKD) EVs has also been extended – it is now in place until December 31, 2027, two years more than the original deadline, which was December 31, 2025.

Likewise, the import tax exemption period for components used in local CKD assembly of EVs. Originally set to run until December 31, 2025, it has been extended by two years to December 31, 2027.

As announced in the first tabling of the budget last October, the government is providing manufacturers of EV charging equipment 100% income tax exemption from year of assessment 2023 to 2032. It will also offer these manufacturers 100% investment tax allowance (Elaun Cukai Pelaburan) for a period of five years.

Tags: Budget 2023

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