Sources said the tax cut would take effect this year and will be made gradually until 2016.
"Minister Datuk Seri Mustapa Mohamed will announce a new policy under Car Price Reduction Program, to stimulate the local automotive industry.
"What is most interesting is that the government will reduce tax imported CBU vehicles, particularly from Japan starting this year," he said when contacted yesterday.
He declined to reveal the total percentage that will drop down the government.
Currently, all imports of CBU vehicles taxed at a rate of 30 percent.
The tax reduction will allow more companies like DRB-HICOM Bhd, the distributor of CBU vehicles from Japan, can offer vehicles at very good prices.
Mustapa told a media briefing after InvestKL in Putrajaya, yesterday confirmed the government will reduce the price of the car not only from Japan, but also including some from Australia.
He said the move was dependent on revenue exemption Free Trade Agreement (FTA) with the two countries carried out in three to four years.
"It will reduce the price of the car from the two countries thus creating positive competition between foreign car manufacturers in the country. Further details will be announced in a press conference tomorrow (today), "he said.
MITI held a press conference on Car Price Reduction Program (CPR) and the vehicle manufacturer (OEM) today.
Announcements will be made that is good news for the locals as the Japanese cars such as Toyota and Honda in particular is among the leading automotive market in the non-national car segment.
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