Here Is How Some Can Avoid Paying Car Import Duties

Why is the tax department and JPJ not impounding cars with no import duties paid

We first heard of ‘carnet’ cars decades ago when we met an AP holders driving a very rare supercar at the time when we had NO unusual registration plates in Malaysia.

We asked what and where the plates were from and he without hesitation explained a quiet ‘loophole’ in the Malaysian car importation game.

At the time, this loophole was being exploited by a very select few and meanwhile the rest of us peasants were paying full import duties for our vehicles in Malaysia. Which by the way is the 3rd most expensive car import duties in the world after Singapore and Hong Kong.

As the years went by, the use of carnet was not noticed by Malaysians as there was little knowledge about it and even better ……. our country had started using various types of number plates (special plates from JPJ and more).

Yes, ‘special’ number plates, embassy plates and even new car trade plates (used by new car and used car dealers to move vehicles around) had increased in Malaysia.

So, this allowed a larger network of carnet plates to be used by the super rich and the super connected via the ‘helpful’ AP holders.

Yes, it is AP Kings and their network that promote the use of carnet registration plates to increase sales of super luxury cars costing Millions of Ringgit (before any import duties).

This means, they are able to purchase a TAX FREE luxury car, drive around without road tax and also without any motor INSURANCE until they decide to sell these luxury cars to the next owner (back from the country of origin).

Meanwhile, the AP holder has made massive profits from the first owner, then they make a second huge profit from the second owner/buyer.

Interestingly, the Government of Malaysia makes NO Money (no import duties, no road tax and no sales tax income).

Fact! Carnet cars are like ghost cars on the road, without insurance, without registration and without any data in JPJ & Customs records”. If A car using a carnet has an accident, there is NO Insurance coverage at all!

So, why does the Ministry Of Trade And Industry have a ‘CARNET’?

What is the reason for having this loophole in our automotive market? Why is there NO enforcement to verify the purpose of the Carnet certificate. 

Well, it all started as NOT a loophole and instead the CARNET is a customs document which is issued by MICC (Malaysia International Chamber of Commerce & Industry).

So, what is the CARNET document?

Well, it is called a ATA Carnet or Carnet de Passages en Douane (CPD), which acts as a passport for a vehicle, allowing for its temporary import into countries like Malaysia without paying full import duties and taxes. 

The law states that, to import a car permanently into Malaysia, you will need to obtain an Approved Permit (AP) from the Ministry of International Trade and Industry (MITI) which comes via the many AP holders also. 

So, a carnet is supposed to be used for temporary importation of a vehicle, such as for a holiday or a short-term event (like a special car launch or a Motor Show like KLIMS and Tokyo Auto Salon). 

So, It’s a customs document that serves as a guarantee that the vehicle will be exported from Malaysia within a specified time, avoiding the need to pay full import duties. 

How to use the carnet? You must apply for a carnet before your trip and present it at the port or airport (some cars are flown in). The vehicle must then be re-exported from Malaysia within the permitted time frame (which is a short period). 

So, right now www.dsf.my is the first media outlet to highlight the abuse of carnet documents in Malaysia and we wonder why mainstream news have never reported it.

We at www.dsf.my also wonder if the good people at MITI and the customs department have knowledge of the abuse of the carnet documents since it has been used for decades without any worry?