Published: Thursday February 28, 2013 MYT 1:38:00 PM
Updated: Thursday February 28, 2013 MYT 4:52:26 PM
Import duties on cars from Japan to be reduced to 0% by 2016 (Update)
By Leong Hung Yee
KUALA LUMPUR: The import duties on cars from Japan will be reduced to 0% by 2016, says International Trade and Industry Minister Datuk Seri Mustapa Mohamed.
He said on Thursday that the import duties would be reduced to 15% in 2013, 10% in 2014 and to 5% in 2015.
On excise duties, he said the government was conducting a research on it. However, he said if this was implemented, it would be carried out gradually.
At a media conference, he said that prices of new cars had started to decline since the beginning of 2012 by about 3% to 5% for some models.
Mustapa said the government had been working with car companies to get them to voluntarily reduce car prices and this has seen the introduction of special rebates for some models since October 2012.
He said the reduction in car prices was due to measures taken by the government to make the industry more efficient and competitive, citing the implementation of the Asean Free Trade Agreement.
“Further reduction in prices will be realized with the liberalization of the automotive industry through other FTAs implementations which will come into force in 2016,” he said.
He added the industry employs 100,000 people directly and 70,000 people indirectly.
The resale and second-hand market employs about 100,000 people. He added that 60% of new buyers depend on the resale value of the existing care to make their next purchase.
As for tax revenue, he said RM7bil was generated from car taxes and this revenue helps the government to subsidise the cost of fuels and other amenities.