Kuala lumpur: The government is considering imposing a levy on every electric vehicle (EV) sold to establish a fund for expanding Malaysia's public EV charging network, according to Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani. Speaking during question time in the Dewan Negara today, Johari said the proposal was being studied as the government faced constraints in financing a nationwide public charging infrastructure on the scale seen in China.
According to BERNAMA News Agency, Johari was responding to a supplementary question from Senator Datuk Leong Ngah Ngah on the government's preparedness for the growing adoption of EVs. "We may impose a levy on every EV sold and channel the proceeds into a dedicated fund to build public charging stations because we cannot rely solely on vehicle manufacturers or distributors to undertake such investments," he said.
Johari mentioned that the government had previously granted exemptions on import duty, excise duty, and sales tax for completely built-up (CBU) EVs for four years to spur market growth and attract investment. However, he noted that these incentives resulted in forgone tax revenue of RM3.3 billion over the period, while investment in public charging infrastructure fell short of expectations.
"After four years, when we looked for public charging stations, the investment from EV industry players was simply not there," he stated. Consequently, the government did not extend the incentives for imported EVs but retained tax exemptions for completely knocked down (CKD) EVs until December 31, 2027, to continue supporting the development of the domestic EV industry.
In response to another supplementary question from Senator Tan Sri Low Kian Chuan regarding measures to ensure EV investments strengthen local vendor participation, Johari emphasized that incentives would only be granted to companies that genuinely develop Malaysia's automotive ecosystem. Companies seeking government incentives must integrate local suppliers into their supply chains and support the growth of domestic vendors and component manufacturers.
He highlighted that Proton and Perodua had developed a network of about 733 Tier 1, Tier 2, and Tier 3 vendors, which account for between 72 and 82 percent of the country's automotive component manufacturing activities. Malaysia would continue to welcome EV investments, provided they generated greater economic value through local vendor development, technology transfer, and the creation of high-skilled jobs.
Johari also pointed out that the lack of public charging infrastructure remained the biggest challenge for EV adoption, particularly for residents of apartments and People's Housing Programme (PPR) projects who were unable to install chargers at their homes. Although EVs represent the future of mobility, he said a comprehensive public charging network is essential to support wider adoption across the country.