Proton gave more than it received from the government, Dr M tells Putrajaya

KUALA LUMPUR, April 6 ― Proton has contributed about RM24 billion to Putrajaya, ex-chairman Tun Dr Mahathir Mohamad said after a minister criticised the national carmaker over plummeting sales despite government assistance totalling RM13.9 billion.

The former prime minister said Proton’s total contribution to the government since 1985 was RM24.1 billion, comprising excise duty (RM11.8 billion), sales tax (RM9.5 billion), corporate tax (RM1.4 billion), import duty from 1985 to 2008 (RM1.4 billion) and Goods and Services Tax (GST) from April 1 last year (RM28 million), totalling RM24.1 billion.

On the other hand, he said, the total government contribution to Proton since 1985 only amounted to RM14.6 billion, comprising customised incentives that are eligible for all automotive players (RM12.5 billion), tax incentives to Proton that are also eligible for non-national cars (RM1.3 billion) and research and development grants, special grants, and stimulus package that are eligible for all automotive manufacturers (RM773.8 million).

“Clearly Proton has paid more to the Government than Government to Proton,” Dr Mahathir wrote on his blog yesterday.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said last Friday that the government cannot continuously protect Proton that now holds just 15 per cent of the domestic automotive market, down from its peak of 74 per cent in 1993.

He said the government has provided RM13.9 billion in grants, various forms of assistance, and taxes foregone to Proton since its establishment in 1983 and told the carmaker that Putrajaya was “seriously deliberating” its request for grants and soft loans, pointing to Malaysia’s falling revenue amid the global oil and commodity plunge.

Dr Mahathir, who resigned from Proton on March 31, also said yesterday that Proton has fully paid up the capital injection from the government in two seed funds totalling RM400 million.

Proton has also fully funded the RM1.8 billion Tanjung Malim plant from internal coffers, which Dr Mahathir said had RM4 billion at one point.

“In addition Proton provides jobs for about 12,000 workers at any one time directly, and more than 250,000 souls indirectly. Proton reduced the outflow of funds probably amounting to more than 100 billion Ringgit,” said Dr Mahathir.

Dr Mahathir noted that Proton seemed to be having “difficulties” with the government and said he did not want to be the cause of the carmaker’s inability to recover, as he explained his resignation from the company which he had set up in 1983.

“I know I am persona non grata with the Government,” said the former prime minister, who was sacked last month as adviser to state oil giant after leading a public campaign for Prime Minister Datuk Seri Najib Razak’s resignation.

“Proton cannot expect any help from the Government. Only Proton owners and fans can help Proton. So please help Proton, your national car maker,” Dr Mahathir added.

Proton was set up by Dr Mahathir in 1983 and remains the epitome of the former prime minister’s industrialisation policies.

It came under the private ownership of the DRB-HICOM group in 2012, but remains identified as a national carmaker.