This article first appeared in The Edge Financial Daily on April 14, 2017

KUALA LUMPUR: UMW Toyota Motor Sdn Bhd has reverted the prices of the Toyota Avanza, Sienta and Rush to previous prices effective immediately. This follows the Royal Malaysian Customs Department’s decision to revise excise duty on multipurpose vehicles (MPVs) below 1500cc from 65% to the previous rate of 60%.

UMW Toyota had earlier increased the prices of the Avanza, Sienta and Rush on April 10, in response to the hike in excise duty by the Customs Department on April 1.

In a statement yesterday, UMW Toyota said the revised prices, based on a 60% excise duty, will be used for customers who collected their MPVs between April 10 and 12.

The price of an Avanza is now back to between RM72,280 and RM83,980, from RM75,980 to RM87,980 previously, while that of the Sienta is now between RM92,900 and RM99,900, from RM96,900 to RM103,900. The price of the Rush has also been lowered to RM104,910 from RM109,900.

Malaysian Automotive Association president Datuk Aishah Ahmad said the sudden hike in excise duty was not expected to affect vehicle sales in 2017.

“The matter blew over in a few days. So, it will not have a significant impact on the total industry volume,” she told The Edge Financial Daily yesterday.

In an about-turn, the Customs Department on Wednesday announced that the move to revise excise duty on MPVs back to the previous level was “to standardise” it in view of the people’s demand for imported cars.

“With this move, vehicle prices must remain the same as before, and vehicle manufacturers are not allowed to increase car prices based on the previously announced excise duty,” its director-general Datuk Indera Subromaniam Tholasy said.

The Customs Department in January this year gazetted a Customs Duties Order 2017, in which it intended to standardise its tariffs under a “Harmonised System” as part of the World Customs Organization’s membership requirements.

As a result, this had affected the tariff code for two-wheel and four-wheel vehicles, such as MPVs, sport utility vehicles, pick-up trucks and vans, with an engine capacity of less than 1,500cc.

This had resulted in the increase in excise duty to 65% from 60%, prompting UMW Toyota to increase the prices of the three imported MPVs by 5%.