Customs denies sales tax not imposed on passenger vehicles

Customs director-general T Subromaniam says sales tax has been proposed for passenger vehicles. (Bernama pic)

KUALA LUMPUR: The Royal Malaysian Customs Department (JKDM) has issued a statement clarifying reports over the misinterpretation of the exemption list for the sales and service tax (SST) that was uploaded on its website.

Its director-general T Subromaniam said that goods exempted from the sales tax (on the exemption list) were only components for completely knocked-down (CKD) vehicles.

“When the vehicles are assembled from the imported CKD components, the completed vehicles are subjected to sales tax,” he said.

Subromaniam said the Customs wanted to clarify that sales tax had been proposed for passenger vehicles.

However, some parties have misinterpreted the list (list of components exempted from sales tax that was released on the Customs website today) that went viral, without referring to the department.

These components referred to the proposed tariff codes to be exempted from sales tax upon the implementation of the SST on Sept 1, 2018.

“With this explanation, the Customs hopes that the issue is closed and does not confuse the people and consumers,” he said.