Changes To Road Tax Mechanism Would Need Extensive study and Time To Implement – Loke

Road tax, formally known as lesen kenderaan motor (LKM), is one of Malaysia's most important sources of revenue. According to Transport Minister Anthony Loke, the annual revenue from road tax is RM3 billion. Currently, the Malaysian road tax fee for motor vehicles is determined by a number of variables, including engine capacity, fuel type, vehicle body type/code, type of ownership, type of use, and the area where the vehicle is declared to be used.

The system has been unchanged for a long time, prompting the question of whether the mechanism should be improved so that it properly reflects the cost of road maintenance in relation to the type of vehicle involved.

That is what senator Robert Lau Hui Yew (SUPP) asked the transport ministry last week in parliament, and in a written response, the ministry stated that the collection of LKM fees is considered revenue collection for the government as a whole, and there is no stipulation under Act 333 stating that all LKM fee collections must be used solely for road maintenance. The ministry also stated that it is constantly looking into existing road tax calculation methods, in collaboration with the JPJ, to ensure that the structure is always relevant based on needs and in accordance with current policies. It stated that any changes to the mechanism would necessitate a detailed study involving various stakeholders, but would also take time to complete.

This follows Transport Minister Anthony Loke's statement that a comprehensive review of the road tax structure was required, but any changes to the current rates for ICE vehicles are unlikely. It does, however, intend to reconsider the road tax structure for electric vehicles (EVs).