By Customs Department
We refer to your article titled “How would you like to own a tax-free luxury supercar in Malaysia?” published on March 15, 2018.
In response to the article, we regret to inform you that the contents of the article are deceptive and misleading.
All motor vehicles imported into Malaysia are subject to import and excise duties as well as the goods and services tax (GST).
In addition to that, import licenses issued by the Ministry of International Trade and Industry (Miti) should also be obtained by importers prior to bringing the vehicles into Malaysia, unless exempted by law.
The importation of goods into Malaysia, including motor vehicles, must be declared to the Royal Malaysian Customs Department (Customs) at the time of import in accordance with the procedures under the existing laws, failing which, shall result in the vehicle being seized and forfeited under the Customs Act 1967.
Guidelines on application for a vehicle import license are available at the official Miti website (www.miti.gov.my).
The import duty is to be paid at the time of importation unless the vehicle is to be moved to a licensed warehouse that has been approved by the Customs or the duty is granted exemptions under the Customs Duties (Exemption) Order 2017.
On the contrary, motor vehicles that are imported into Langkawi or Labuan are not subject to import duty.
When such vehicles are registered with the Road Transport Department [RTD) in Labuan or Langkawi and later brought into the “Principal Customs Area” (areas other than Labuan or Langkawi) for a period not exceeding three months (90 days), the vehicles will be exempted from import duties provided all the conditions set out under Item 14 of the Schedule under Part I of the Customs Duties (Exemption) Order 2017 are fulfilled.
Among the conditions imposed are, the registered owner of the vehicle must submit a security in the form of a Bank Guarantee or General Bond to the Customs, depending on the category of the vehicle.
Vehicles that are temporarily imported for the purpose of re-export – other than those granted exemptions under Paragraph 12 of the Customs (Prohibition of Imports) Order 2017 – are still subject to import licenses.
However, they are exempted from the import duty on the condition that the vehicles must be re-exported within three months of the date of import.
Import license exemptions are granted to the following vehicles as per Paragraph 12, Customs (Prohibition of Imports) Order 2017:
(1) Motor vehicles that are permitted to enter Malaysia under the Road Transport Act 1987 (Act 333);
(ii) Motor vehicles duly licensed in Brunei and permitted to be used in Sarawak under the prevailing laws for road traffic or vehicles;
(iii) Motor vehicles entering Malaysia under an International Permit Circulation as prescribed by the prevailing laws for road traffic or vehicles; and
(iv) Motor vehicles entering Malaysia and driven or used by bona fide travellers.
Any person found to have committed offences, such as making false Customs declarations, producing false documents, or imports or possesses vehicles without paying the import duty or valid import licenses, may be charged under the Customs Act 1967.
Thus, based on the existing procedures and legislations in force, the Customs hereby strongly refutes the author’s claims in the said article that motor vehicles may be imported into Malaysia without import licenses and payment of duties.
* The views expressed are those of the authors and do not necessarily reflect those of FMT.
How would you like to own a tax-free luxury supercar in Malaysia?