Automotive McLaren Longtail

Published on June 11th, 2020 | by Daniel Sherman Fernandez


Rich Malaysians Enjoy Tax Free Cars…Why Not The Rest Of Us?

The Policy MUST Be Changed For Tax-Free Cars And It Must Be A Fair Playing Field!

This is not NEW news. Ever wonder why luxury car launches include tax free selling prices? Why do they never include the final selling prices like what all non luxury car brands do? Is it such a big secret to share the import tax that will be paid on a new luxury car?

The recent Rolls Royce Cullinan Black Badge launch had a tax free car price list of RM1.7 million and the Ferrari Roma launch also had a tax free car price list of RM968,000.

Lamborghini Huracan

Well the reason is this, almost all luxury car buyers in Malaysia end up buying tax free cars and then they have them stored in duty-free Langkawi for 2-3 years to get them aged to lower the import tax and then enjoy owning these cars at a much lower price, while the rest of us buy fully taxed cars and keep the wheels of our government moving without a hitch.


So, why can’t the rest of us buy a tax free compact crossover like a Toyota C-HR or a family sedan like the Mazda6, have it stored in Langkawi until we get the tax lowered and then drive it around?

Well, the tax saved will be almost the same as buying the Toyota C-HR and Mazda6 used two years later and the savings is just not worth the paperwork and storage costs.

Malaysians with available funds sitting in the many banks have been buying their tax free car for years and enjoying lower import taxes when it was time to bring them for sale or for re-export.

Porsche 911 Targa

Here is how it works. The vehicle tax system in Malaysia allows the sale of an imported car to be tax free if kept on the tax free island of Langkawi.

Then every 90 days in one year (365 days) this tax free car is allowed into Peninsula Malaysia as long as it has valid road tax and insurance to be driven by its owner and then it must be returned to the ‘dealers warehouse’ in Langkawi until the following year.

So, if you buy a new tax free McLaren, you ‘store’ in Langkawi and when you feel like driving it, you fly into the island and take it across to the sea by ferry to the mainland and you have 90 days to enjoy the car, or say just 10 days or so and return it and then you can take it out again for another 10-20 days, maximum is 90 days a year.

Now, you do this for 2 to 3-years and then you decide to pay tax, the calculation by the tax department will include a huge 2 to 3-year depreciation and you pay a much lower lower tax bill and the car is yours to drive every day in Peninsula Malaysia.

Pagani Zonda

Now, if after 2 to 3-years, the tax free car in question, for example a limited edition McLaren or a Ferrari Roma has risen in value in Britain or maybe Thailand or Australia (right hand drive nations) you can then export your tax-free car and make some money and buy another limited edition super luxury car and repeat the process.

Some Porsche GT owners did it a few years ago and most of them made a sizeable amount of money and they did it again and again and again. It is truly a wonderful way to make money and enjoy doing it.

Now if you do this for a few years, the next car might actually cost your nothing as we have seen some smart Malaysian luxury car owners having enjoyed. 

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