THE Malaysian Automotive Association (MAA) has welcomed the government’s decision to provide tax incentives for electric vehicles (EVs) under Budget 2022 and said this would further boost their sales.

MAA president Aishah Ahmad said the demand for EVs would now increase with the incentives given and claimed more car makers would be looking at bringing EVs into the Malaysian market.

“Since the incentives were announced, there have been a lot of queries on EV vehicles and there is also an increase in demand for EVs now from potential customers.

“Sales will definitely increase tremendously with the incentives given and a lot of car brands are looking into bringing EVs,” she told The Malaysian Insight.

Under Budget 2022, Finance Minister Tengku Zafrul Tengku Abdul Aziz announced a 100% elimination of all taxes on EVs in the country, including import and excise duties, as well as road tax.

On top of that, individual income tax relief of up to RM2,500 will be given for the rental, hire purchase, purchase and installation of EV charging facilities, and payment of EV charging facility subscription fees.

Besides the tax exemption, Aishah said focusing on infrastructure development would further support growth of the EV segment.

“As for the infrastructure development, we are hoping that more will be in place that would support and increase EV sales,” she said.

Aishah added that all stakeholders lauded Putrajaya’s decision to provide incentives but said a long-term solution is needed to attract foreign investors.

“This (tax exemption) is certainly welcomed but I think the government should also put forth a long-term proposal to incentivise EVs.

“It cannot be for two years and then that’s it. If we want foreign investors to come in, then there should be a long-term proposal,” she said.

Malaysian Electric Vehicles Owners Club (MyEVOC) president Shahrol Azral Ibrahim Halmi also hailed the move by the government, saying more people would make a switch from conventional vehicles to EVs.

He said the younger generation was now keener on EVs.

“The tax exemptions for battery EVs are certainly most welcomed by users, especially those who are already keen to replace their internal combustion engine cars over the next two years.

“There is certainly growing interest in EVs, especially among younger motorists,” he said.

Shahrol said the tax exemption would see at least over 200 EVs sold in the coming year, slowly increasing the number of EVs in the country.

The co-founder of MyEVOC was confident that EVs would displace internal combustion engine cars in years to come.

“There are tremendous benefits to the environment, people and industry if this transition is proactively managed.

“There’s momentum building and we as a country need to seize this opportunity to decarbonise the transportation sector – the second largest greenhouse gas emitter,” he said.

The use of EV vehicles is in line with the country’s goal to reduce greenhouse gas emissions by 45% by 2030, as outlined in the 12th Malaysia Plan. – December 31, 2021.