Also known as a “relief for second-hand goods,” The Sun Daily recently quoted Deputy Minister of Finance, Datuk Chua Tee Yong, to say that the decision to allow used-car dealers to apply for the ‘margin scheme’ came after meetings between “Customs and industry associations.”
To give you a bit of an insight into the situation, here’s the Malaysian Automotive Institute’s (MAI) guide to how the coming GST will affect the pricing of locally-assembled and imported vehicles:
Local Cars: Open market value + Excise duty + GST (6%)
Imported Cars: Transaction value + Import duty + Excise duty + GST (6%)
Given the ‘margin scheme’ that’s now applicable to used cars in the industry, everything but a dealer’s profit margin will be exempt from GST in the purchase of a used car.