Budget 2024: Major Auto, Transport-Related Points

When tabling Budget 2024 in Parliament on Friday (Oct 13), Prime Minister Datuk Seri Anwar Ibrahim mentioned several matters concerning the automotive and transportation sectors.
Among the key takeaways are diesel subsidies, an increase in service tax, electrification, and road improvements.
PM Anwar stated that the targeted diesel subsidy will be implemented in phases and will benefit users such as goods transport and logistics companies while charging other users a higher price.
According to Anwar, the current subsidised diesel price of RM2.15 per litre would be RM3.75 per litre at market price. As a result, the government bears RM1.60 per litre of diesel sold, or approximately RM1.5 billion ringgit in total.

Although no timetable for the implementation of the targeted subsidy has been specified, the initiative is expected to reduce subsidy leakage and its impact on consumer prices.
Also, Malaysians will see an increase in service tax from the current 6% rate to 8% next year, which will apply to vehicle servicing in terms of labour charges. As a result, the 8% service tax increase on labour charges will almost certainly result in higher overall vehicle servicing costs when the new rate goes into effect next year.
As expected, electrification is still on the agenda, with the current import duty and excise duty exemption for fully-imported (CBU) EVs extended until December 31, 2025.

The government will also continue to support the local EV industry and promote consumer acceptance. TNB, Gentari, and Tesla Malaysia will invest over RM170 million to install 180 EV chargers. To encourage the use of electric motorcycles, rakyat earning less than RM120k per year will be eligible for an RM2,400 rebate.

In line with Malaysia's transition to clean energy, the federal government will use EVs as official vehicles, and Prasarana will purchase 150 electric buses and construct three depots for LRT 3 at a cost of RM600 million.

State governments will use the MARRIS budget of RM5.4 billion to keep state roads in good condition. Next year, RM2.8 billion will be allocated to maintain federal roads and bridges, as well as other budgets to make high accident rate areas safer, as well as to install smart traffic lights for smoother flow.

Finally, the government will give permission to reopen five previously cancelled LRT3 stations: Tropicana, Raja Muda, Temasya, Bukit Raja, and Bandar Botanik. The Penang state government intends to build the LRT Pulau Pinang-Seberang Perai via a public-private partnership.