Of cars and spending power!

Things are getting expensive and consumers’ spending power is falling off the charts; this seems to be the talk of the day post Sarawak state election. Seriously they are, it’s literally all over the net. Of course the mainstream media would tell you otherwise, the only thing they report of late are news of the Federal Government so called achievements and development programs with fancy acronyms… and we all live happily ever after.

If you don’t feel the pinch of the increase in prices than you must be pretty damn rich - in which case this entry would not be of interest to you. But if you are anything like me an average income earner gasping for air in good old Bolehland than “pinch” is an understatement… by miles. 

It would seem that the whole economy is on the verge of annihilation, and why not? As prices of goods are sky rocketing the consumers’ spending power will consequently plummet slowly but surely to oblivion. And this would only mean one thing retail business would suffer and that in turn would mean the businesses would suffer which would of course lead to people being out of their jobs! Hey, let’s not even talk about retail goods like your pants, shirt and underwear when even food stuff is at an all time high.

But I have a solution to this calamity; at least I think I have, and here it goes, increase the spending power of the people… Yes, I know I am merely stating the obvious but wait I would now also go a step further by suggesting how – and here it is, review the National Automotive Policy and decrease if not abolish import taxes, levies etc on vehicles. Yes, ladies and gentleman this is my propose solution. I believe by doing this the government could help the average consumer boost its spending power. And why wouldn’t it? After all, the average income earner would probably spend up to a quarter of his monthly salary on his car’s monthly installment and he wouldn’t have to if it wasn’t for the National Automotive Policy and its protectionism over the local car manufacturers. The fact of the matter is that cars are so much more expensive in Malaysia than they are actually worth.

Let’s take an example of a pre and post tax waiver or discount if you like; the government’s waiver on taxes and levies for hybrid vehicles. The moment that was announced a Civic hybrid went from RM160k plus to a smite over RM100k, the Prius from RM180k to about 120k. Now, Imagine extending this waiver to other cars say those costing RM70k at the moment, the prices could just as easily drop to about RM40k. Now imagine yourselves paying RM500 a month for a Ford Fiesta or Mazda 2 instead of RM800 and go a step further and picture yourself shopping with the “extra” RM300. Also if you are fresh graduate earning RM2000 like I did, imagine paying less than RM300 a month for a Chery. Imagine what you could do with all that “extra” which would otherwise be spent on your car.

Well, you might argue that if this were to happen it would probably spell the end of local automotive companies like Proton and its employees. My response to this is quite simply, so what? Think about it, if the government could easily consider spending RM50 million on emails and a few billion on a Menara which nobody needs, why not spend a similar amount on bailouts or schemes to assist the than Proton unemployed. I think this is money better spent by any standard. Call me self centered and shallow but having a few thousand unemployed ex-Proton employees certainly sounds better than having half the country’s population cannibalizing their limbs for lunch and having fried road kill for dinner.           

Than you might also argue that the government will lose income, well to be frank I think you are right, they might. But hey, now that the GST (Goods and Services Tax) has been gazetted and will probably be coming to force a day after GE13, the government will not only be making money from our earnings through the income tax, they will also be taxing us for every single cent we spend. Since there is no news on the abolishment or “discounts” to the existing income tax, logic dictates that we the people of Bolehland will be paying double taxes, hoorah! Remember the guy with the “extra” RM300 just now? He will paying taxes with that money as well.  

Well as the saying goes, nothing is certain in life except for death and taxes! Thus on that bombshell I bid you all the best and good luck citizens of Bolehland!