Langkawi’s duty-free overhaul: RM300,000 vehicle price cap and RM10,000 spending limit

KUALA LUMPUR, Oct 26 — Deputy Finance Minister Liew Chin Tong explained that the purpose of changing the duty and tax exemption policy for vehicles on Langkawi was not to enable wealthy individuals to keep luxury vehicles on the island for extended periods, but to prevent revenue leakage and deter such practices. Speaking during a Special Chamber session in the Dewan Rakyat, Liew addressed concerns raised by Datuk Mohd Suhaimi Abdullah (PN-Langkawi) about the RM300,000 threshold for vehicle tax exemptions and the need for stricter enforcement to prevent abuse of the facilities.

He acknowledged that some business operators would be affected but assured that local residents would not be impacted. As of January 1, 2026, vehicle exemptions will be capped at a value of RM300,000 to ensure the benefits remain focused on local residents, car rental operators, taxi services, and commercial vehicle users. Liew also announced that the threshold for duty-free purchases by visitors and tourists would be raised from RM1,000 to RM10,000 in Budget 2027, covering additional categories like fashion accessories, electronics, and textiles.

This change aims to boost the economy by generating a direct economic spillover for shop owners and local entrepreneurs while expanding the list of Langkawi-made goods eligible for import duty exemptions.