Will SST exemption be extended? Finance Ministry has final say, says Dr Wee

KUALA LUMPUR: The decision to extend the automotive sales and service tax (SST) exemption scheme is the Finance Ministry's prerogative, says Datuk Seri Dr Wee Ka Siong.

The Transport Minister said although he views the exemption as beneficial to the automotive industry, the Finance Ministry will have its own considerations to make.

"When we were faced with the Covid-19 pandemic, the government decided to implement the SST exemption.

"As a result, the automotive market – especially second hand car businesses – were able to remain viable. Otherwise, it would have been difficult for the dealers to survive in the pandemic.

"The incentive has helped to boost the economic sector and our recovery, and the Transport Ministry is able to see through the transactions at the Road Transport Department.

"However, we need to consider the country's financial capabilities and for that, I will leave it to the discretion of the Finance Ministry," said Dr Wee at a press conference after the launch event of the Atlas automotive operating system (OS) here today.

Dr Wee said he would meet and share his thoughts on the matter with Finance Minister Tengku Datuk Seri Zafrul Tengku Aziz.

"As Transport Minister, I feel the exemption scheme has been a boon for businesses and car dealers. They were able to maintain their businesses and did not have to resort to getting rid of workers.

"Whatever decision made by the Finance Ministry will be supported by the Transport Ministry, as we are part of the same government. It is a collective decision and responsibility," said Dr Wee.

The SST exemption was implemented as part of the Penjana stimulus package, which was meant to mitigate the effects of the Covid-19 pandemic.

The scheme was originally scheduled to end on Dec 31, 2020, but has been extended three times. It is due to end on June 30, 2022.