We are studying whether there is a need to increase the rates, but as of right now, the rates are still the same, says MoF

by SHAHEERA AZNAM SHAH / pic by MUHD AMIN NAHARUL

THE government is yet to decide on the revised rate of excise duty for locally assembled vehicles, said Finance Minister Lim Guan Eng (picture).

Lim said the Ministry of Finance (MoF) is still discussing with other ministries and industry stakeholders to ensure that any changes to the duty, if necessary, will oblige the World Trade Organisation (WTO) regulations.

“What has been reported about the raised duty rates is just speculation. We are studying whether there is a need to increase the rates, but as of right now, the rates are still the same.

“We are still in a discussion because we want to meet the regulations of the WTO,” he said at the launch of the government guarantee schemes for small and medium enterprises (SMEs) in Kuala Lumpur yesterday.

When asked whether he foresees a hike in the duty rates, Lim said should there be a raise, the government will implement it in stages and not abruptly.

Lim added that the government is focusing on identifying carmakers who are not submitting transparent reports on their production to the government, which has been an issue to the industry.

“Now, we want to ensure that they are reporting correctly with accurate and verified data,” he said.

On Monday, Deputy International Trade and Industry Minister Dr Ong Kian Ming said matters related to the excise duty of the completely knocked down (CKD) vehicles are still being discussed between his ministry and MoF.

According to the Auditor General’s Report 2018 Series 1, the government had exempted RM4.89 billion of excise duty for locally assembled vehicles between 2015 and 2017.

The report revealed that during the period, a full excise duty exemption was approved for 73,250 units of CKD vehicles.

On a separate matter, Syarikat Jaminan Pembiayaan Perniagaan Bhd (SJPP) principal officer Chen Yin Heng said there are about RM20.5 billion of financing remaining under the government’s guarantee schemes for SMEs.

“Since its inception, SJPP has managed to get the financial institutions to make available RM33.5 billion worth of financing, of which RM13 billion has been retained.

“We believe the remaining RM20.5 billion is sufficient to provide the opportunity for SMEs to grow,” he said.

Commenting on the schemes’ non-performing loan (NPL), Chen said the government is comfortable with its current rate of 3%.

“Loans and financing are all bound for risk. Currently, our NPL is about 3%, a bit higher than the banks’ 1% to 1.5%.

“There are a lot of factors that determine the NPL, but Bank Negara Malaysia is monitoring the figures. We think 3% is very manageable,” he said.

Under Budget 2020, SJPP, a company wholly owned by the Minister of Finance Inc, has been mandated by the government to administer and manage four guarantee schemes for Bumiputera, female entrepreneurs, startups and SMEs who are involved in automation and digitalisation.