Minister: Slashing car prices will cause economic instability

The nation will experience economic instability and many will go bankrupt if the price and excise duty of vehicles are reduced.

Minister in the Prime Minister's Department Nor Mohamed Yakcop said, getting rid of taxes for cars would reduce national revenue by RM7 billion which could affect infrastructural development, especially in Sabah and Sarawak, and in the interior of the peninsula.

"If the opposition makes a decision to get rid of the excise tax, the people who are living in poor conditions cannot boost their lives because money is not available.

"When they do away with the excise duty, the price of cars will go down, that is correct... but if the reduction is sudden, those second-hand car dealers with numerous vehicles will definitely go bankrupt.

"What about the people who work at the (second-hand car dealer) shops? It will give a side-effect to the economy.

"It is possible, if you want to reduce the excise duty, but (one) must think of many aspects, the negative and the positive," he told reporters after visiting 76-year-old Leha Nayan's house, in conjunction with the Concerned Tenaga Nasional Berhad (TNB) Programme in Tasek Gelugor today.

Shallow thinking

Nor Mohamed said this when commenting on a statement by PKR strategic director Mohd Rafizi Ramli who promised to reduce the price of cars if the opposition pact won the 13th general election.

He likened the opposition pact promises to its shallow thinking because they made statements without studying and thinking of the implications on the nation.

He said the attitude of the opposition was opposed to the BN government which always placed the people's welfare uppermost by making decisions, based on wisdom so that the economy could be generated and the people would prosper.

On the Concerned TNB Programme, Nor Mohamed, who is also Tasek Gelugur member of parliament, said the programme was in line with the government's aspirations in wanting to ensure the people had electricity supply.

He said only one per cent of residents in peninsula Malaysia and five percent in Sabah and Sarawak had yet to obtain electricity supply, adding that efforts to locate them was ongoing.

- Bernama