It’s confirmed: sales tax exemption on locally assembled (CKD) and fully imported (CBU) cars is set to end next week on 30 June 2022 as scheduled. However, existing orders can still enjoy the tax savings beyond the deadline, provided the car is registered by 31 March 2023.

Existing order, in this case, is defined as booking that is placed by 30 June 2022. As long as you fulfill this criteria and you receive the car by 31 March next year, you will get to enjoy the sales tax exemption. In our opinion, this is a fair compromise, rather than giving yet another extension.

According to finance minister Tengku Zafrul Aziz, the registration period is extended to 31 March 2023 due to chip shortage that affected the delivery of cars. This – combined with the floods in the Klang Valley area – impacted the delivery capacity of many carmakers, including Proton and Perodua.

Given that only bookings placed by 30 June will get to enjoy the sales tax exemption, it’s highly likely car sales will spike before the end of the month. Hopefully, those who have been eagerly waiting to receive their cars will get them by 31 March 2023.