Indirect Taxes       a. Heavy Machinery As a measure to curb the importation of capital goods, it is proposed that with effect from October 17, 1997 the import of all heavy machinery for the construction sector be approved by the Ministry of International Trade and Industry. Approval will be given if these machinery are not available locally. A list of such machinery subject to approval is shown in Appendix I. b. Capital, Construction Goods and Consumable Products To develop the local engineering, mechanical and construction industries, import duty on capital and construction goods reflected in Appendix II has been increased with effect from 4.00 pm October 17, 1997. Simultaneously, to encourage the consumption of local products, the rate of import duty on selected consumer products which are manufactured locally has also been increased with effect from 4.00 pm October 17, 1997. Details of the items involved are given in Appendix II. c. Leather Goods and Apparels To assist in promoting the tourism industry and to enhance Malaysia as a shopping paradise, import duty on various items per Appendix III were reduced with effect from 4.00 pm October 17, 1997. d. Motor Vehicles In an effort to curb the import of luxury goods, it is proposed that with effect from 4.00 pm October 17, 1997, import duty on vehicles, whether in the form of CBU or CKD, listed in Appendix IV be increased accordingly. It is also proposed that import duty, excise duty and sales tax on motor cycles with engine capacity of 200 cc and above as listed in Appendix V be increased effective 4.00 pm October 17, 1997. In addition, in line with the government's policy to curb imports, it is proposed that import duty on golf buggies and go-kart be raised to 50% with effect from 4.00 pm October 17, 1997. Further, in view of the increased interest to use solar/electric powered passenger vehicles, it is proposed that a specific tariff code for such vehicles be created and an import duty of 50% and sales tax of 10% be imposed.

[page 21 of 27] | Back | Contents | Next | | Home | This report is reproduced with permission from Kassim Chan Tax Services Sdn Bhd (36421-T) and Deloitte Touche Tohmatsu Tax Services Sdn Bhd (151497-P). 7th Floor, 3 Cangkat Raja Chulan 50200 Kuala Lumpur, Malaysia or P.O.Box 11151, 50736 Kuala Lumpur, Malaysia. Telephone: (603) 232 0711, Facsimile: (603) 2304746, (603) 230 0585 No part of this report may be reproduced in any form without the prior consent of Kassim Chan Tax Services Sdn Bhd and Deloitte Touche Tohmatsu Tax Services Sdn Bhd. Another Malaysian resource site designed and hosted by MIR Communications Sdn Bhd.