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Government Still Committed To Lower Car Prices

2 July, 2013

The government is committed to fulfill its promise to lower car prices but will still ensure the development of the national car remains competitive although fierce competition can be expected from the reduction of car prices.

The government remains committed to reduce the prices by 20 to 30 per cent in five years as promised in the Barisan Nasional (BN) manifesto before the 13th General Election.

"However, currently, the government has no intention to reduce the import duties as a mechanism to lower car prices. The elimination of import duties does not guarantee a reduction in the price of a car," said deputy minister of International Trade and Industry Datuk Hamim Samuri when replying to Datuk Chua Tee Yong (BN-Labis) at the Dewan Rakyat, here, Tuesday.

"Reduction of import duty cannot be implemented immediately as car prices are determined by several factors, including manufacturing companies and vehicle assemblers, foreign exchange rate, transportation cost, insurance and loan interest rates.

"In addition, the elimination of excise duties will affect the government's tax revenue which is estimated at RM7 billion a year.

"The reduction of tax revenue will limit the government's ability to provide basic needs to the people," he added when answering a question from Anuar Abdul Manap (BN-Sekijang).

"The government will continue to support the development of the national car to remain competitive locally, regionally and globally.

"As for the issue of disposing used cars, especially those over 10 to 15 years, the government is ready to review the life span for such vehicles in line with the National Automotive Policy (NAP).

"The government has introduced measures to address the issue since the introduction of NAP in 2009, but had to be withdrawn after receiving numerous complaints," he added.

Meanwhile, replying to a question by Datuk Seri Reezal Merican Naina Merican (BN-Kepala Batas) Hamim said thus far, there was no application from any company to import wheat containing genetically modified organisms (GMO).

-- BERNAMA