The government's stance on excise duties were made clear today at the National Automotive Policy 2014 announcement - its current fiscal position benefits from the revenue obtained from charging excise duties, so excise duties are to stay.
However, MITI minister Datuk Seri Mustapa Mohamed said that the government is constantly reviewing its fiscal position and is open to the possibility of reducing excise duties when the fiscal situation permits it.
Excise duties currently stand at about 65% to 105%, however many car manufacturers pay much less than that thanks to the various mechanisms in place in exchange for car localisation. According to Datuk Seri Mustapa, the average excise duty being paid per car is about 50%.
It provided the government with revenue of about RM7,308 million in 2013. In addition, RM480 million was collected in the form of import tax and RM2,039 million in the form of 10% sales tax.
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