Budget 2027: Excise duty, sales tax exemption for Proton, Perodua taxis continues

The government will continue providing full excise duty and sales tax exemptions for new Proton and Perodua cars purchased by taxi and private-hire car operators, maintaining an incentive aimed at reducing vehicle acquisition costs for the sector. The measure was previously announced under Budget 2026 by Prime Minister Datuk Seri Anwar Ibrahim, who said the 100% exemptions would continue to apply to purchases of new national cars by taxi and private-hire vehicle owners.

The tax incentive is intended to make locally manufactured vehicles more affordable for commercial passenger transport operators, who face significant costs in acquiring and maintaining vehicles used for daily operations. In addition, to improve operational efficiency and safety, HRD Corp has allocated RM10 million to cover the cost of courses and allowances for contributing licensed taxi drivers undergoing capacity-building training.

The incentive is separate from the Teksi Madani programme, launched by Anwar in July 2026, which introduced a new Proton S70 taxi priced at around RM64,500 on-the-road without insurance, with excise duty and sales tax exempted. Under Teksi Madani, the government also announced a RM10 million matching grant to encourage existing taxi owners to replace older vehicles, with up to RM2,000 in support from Proton matched by up to RM2,000 from the government.

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