GST zero-rated: Volvo cars discounted by up to RM23k

KUALA LUMPUR: Volvo Cars Malaysia has released a revised price list for its models following the government’s decision of changing the Goods and Services Tax (GST) from 6% to 0%. The new Pakatan Harapan government last week announced this change which will come into effect from June 1, 2018. Thus, the Volvo cars are going to be cheaper by up to RM 23k.

The newly released on-the-road prices (excluding taxes) will continue until further notice from the Ministry of Finance regarding a complete replacement of GST with the Sales and Services Tax (STT). Well, this definitely won’t happen overnight. According to Tun Daim Zainuddin of the government’s Council of Eminent Persons, it might take anywhere between two to three months to implement STT in the country. That’s fairly a long tax-free window for customers looking to buy one of the Volvo cars.

Following the GST rollback, the price of the cheapest Volvo model, V40 T4 is reduced by RM9,239.07. The most expensive model, top-spec S90 T8 Twin Engine Inscription Plus which currently retails at RM413,888 will be available for RM366,913.08, representing a saving of RM21,974.92. The S60 T6 will now retail at RM225,403.65 as against RM238,888 (saving of RM13,484.35) while the top-spec XC60 T8 will now be available at RM324,463.83 instead of RM343,888 (saving of RM19,424.17).

Despite the fact that the 6% GST has completely been called off, the revision is slightly less than 6%. That’s because only the sales price of a car includes GST, onto which other pricing elements like road tax, registration fees, and ownership endorsement fee (without GST) are added to calculate the final on-the-road price without insurance. But still one shouldn’t be complaining about it.

Moreover, the company also stated that the zero-rated GST will also be applicable to the pricing of parts and services across all authorised dealers including purchases of Volvo Service Agreement (VSA) packages. Starting June 1, the VSA 3+ package will be available for RM5,900 (saving of RM354) while the VSA 5+ package for RM9,200 (saving of RM552 ). The package covers the scheduled maintenance along with wear and tear of parts