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- Category: LOCAL AUTOMOTIVE NEWS
1. For Passenger Cars and Commercial vehicles they need to apply to the Customs to get an evaluation (Penentuan Nilai Jualan) for the purpose of payment of sales tax for locally assembled models. Does an importer/franchise holder still need to go through this process?
(The sales tax is 10% on the value that has been determined by the Customs)
Ans: GST will be replacing the sales tax. Therefore, all Importers/ franchisee shall go through the same evaluation process for the purpose of payment of GST on locally assembled models.
(6% of GST will be charged on the value determined by the Customs.)
2. Can a second-tier seller make any GST drawback/refund if he sells to the end-user with a lower price than what he had purchased earlier?
Ans: Second-tier sellers are allowed to claim input tax (GST on any acquisition made for the purpose of business) regardless of their selling price to end-users. Somehow, if goods are sold at lower prices to connected persons, then we shall follow the open market value for tax accountability.
Scenario: Jualan Motors Sales sold to dealer A at ringgit 100,000 + ringgit 6,000 (6% GST) = 106,000 ringgit. Due to certain circumstances e.g. year model, minor accident, etc., the dealer A had to sell the vehicle at ringgit 90,000 + ringgit 5,400 (6% GST).
Earlier he had paid GST ringgit 6,000 (in Jualan Motors Sales invoice to dealer A), can dealer A get a drawback/refund of ringgit 600 (6,000 – 5,400) from the Customs?
Ans: Dealer A can claim the input tax incurred in the month the acquisitions were made. And, on subsequent sales made by dealer A, GST is to be charged on the price that is sold. However, if it is sold to a connected person who cannot claim the input tax, then it must be based on the open market value.
3. Booking deposit/ fee received from customer for ordering a car is subjected to GST? What is the GST impact on booking fees being forfeited as a result of order cancellation?
Ans: Booking deposit for ordering a car whether refundable or not is not subjected to GST provided that deposit is not considered as a part of payment for the car.
If the supplier applies a booking deposit as a part of payment for a supply of a car, the booking deposit is subjected to GST. Supplier has to account for output tax from the deposit. If the deposit is wholly or partly refunded as a result of order cancellation, the supplier is required to issue a credit note.
If the supplier applies a booking fee as a consideration for a supply of services for ordering a car, the booking fee is subjected to GST. Supplier has to issue a tax invoice for such services supplied. If the fee is wholly or partly refunded as a result of order cancellation, the supplier is required to issue a credit note.
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