Minister of Domestic Trade and Consumer Affairs Datuk Shahrir Samad announced today that petrol prices at the pump may most likely increase in August 2008, two months from now. Details on the price hike and fuel subsidy are still sketchy, but here is what we know at the moment.
- A new subsidy system will be implemented based on need rather than use.
- The keyword of need rather than use indicates that a person with high income, despite choosing to use a very fuel efficient car will still not qualify for subsidies.
- What we know is that some will have to pay a higher market price for unsubsidised fuel, but we do not know if the subsidised RM1.92 price will remain or increase.
- Diesel prices will also go up, and based on previous reports the hike could be higher than the petrol price hike.
- The unsubsidised market price fuel sold at the pumps may be sold at cost plus profit which is already high enough, but there is also the possibility for the government to include fuel tax which will drive the price up higher.
If tomorrow’s cabinet meeting goes well, we will be able to know full details on what the new fuel price and subsidy plan is on Wednesday.
These are truly worrying times when even heavily subsidised Brunei is considering reducing subsidies, a move that will increase the price of fuel in Brunei, which currently stands at B$0.53 per litre, or about RM1.22 per litre. But Brunei’s move is more of an energy conversation and environmental issue, as the cheap fuel prices have made most Bruneians wasteful with the usage of the precious commodity.
8:15PM UPDATE: The Prime Minister announced that the new revised fuel subsidy plan will take effect immediately from Wednesday onwards to “avoid any speculation.”
8:20PM UPDATE: Datuk Shahrir Samad was asked by Reuters to comment on the PM’s earlier announcement that the new fuel subsidy structure would take immediate effect. Datuk Shahrir only said that Wednesday’s announcement would be an incremental step towards a total restructure in August and did not elaborate further.
Looking to sell your car? Sell it with Carro.
well i suppose the based on “need” vs “use” is to curb abuse by rich people who buy small capacity cars, no?
this means they will start tracking “need” via your income tax? it’ll be interesting to see how many tiers of fuel prices there will be and how it affects the capacity of your car.
if this “need” logic holds true, it would still make sense for a rich person to buy a smaller capacity car as it will consume less “expensive” fuel.
now comes the cruncher – can a rich person buy fuel from a poor person? it would be difficult to cap the amount of subsidized fuel a person can buy since it varies quite a bit (a poor person who does a lot of travelling vs a poor person whose office is 5km away would make this system difficult to implement).
brace yourselves!!!
The poor selling subsidised fuel to the rich – that would indeed be a problem, since there has been no mention of a cap of how much subsidised fuel can be purchased every month. We will know the full details on Wednesday, hopefully, if everyone that needs to attend the meeting tomorrow are present.
“….that a person with high income, despite choosing to use a very fuel efficient car will still not qualify for subsidies.”
To discriminate a person with high income but chooses to drive in a fuel efficient car is rather odd and down right mind boggling.
ermm, what if the gov enter the amount that need to be subsidized to every malaysian mycard? The amount that need to be subsidized should based on income AND the car used ( car price and cc is the key point here ).The information in mycard should include car/cars everybody owned. This will prevent the poor from selling the petrol to the rich as the record will show unreasonable amount of petrol used per month. For every purchased the petrol price will be based on this information on mycard. Complex? Can it be done?
It is fair that rich are already paying more tax(income tax, capital gains or whatever) and that they are being made to pay more for fuel???
Correct me if i’m wrong but has there been such a system implemented any where in the world?
To make the rich to pay more regardless of car price is shocking. Isn’t the focus is to reduce on fuel consumption and encourage fuel efficient vehicles. Then again, how is the government going to segregate the rich from the poor.
I still think the rich are still able to acquire “poor” status in order to continue enjoying subsidised fuel.
B$0.53 per litre? This must be untrue.
If it is true than malaysia must learn from Brunei.
We believe that there is also no road taxes in Brunei. We are also aware cars are imported and are very very cheap.
If only we (the gov) learn then we would be really a happy lot.
Remember we must talk of dollar to dollar and what more when we are producer of black gold and thus we should have been selling petrol at RM0.53 and not RM1.92!
Great. See lots of Black Market fuel stations coming up.
Person who falls in the ‘need’ category buys the fuel and sells it to a middle man with skid tank and he sells it on the open market at a slightly reduced price from the gas station. Worst if a gas station owner buys the fuel back and put it back into his tanks and sells it again.
hmm, typical sketchy details.
we can’t confirm anything as of yet, except that pumping petrol is gonna suck and suck us dry, to add to our underpaid workers.
and the increase in diesel does not justify itself unless there is an improvement of diesel quality. freaking move to Euro 3/4 please. i’m sick of Euro 1 diesel content spewing all over our roads.
Again? `High income, low income’… how high is high? how low is low? Base on what shall they decide? Income tax? Payslips? What car they own? Hello…. Do they still believe that every citizen declares their every single cents of their income each year?
Does poor people really need a car? These `rich and poor’ is strongly a politically motivated mindset… As i said, there are MANY ways for the g to help the poor or the targeted group..
Already a high tax and duty for cars, toll roads and toll rates (+the jam that the toll plaza), road tax, and now a higher fuel prices.. Sigh….
Socialism
Abolish importation tax on vehicles, road tax, toll collection etc.
Then all fuel will not be subsidised.
One can buy any big cc car if they want, but they would think twice before pumping petrol. That will curb petrol usage, and solve the problem of subsidiesed petrol being sold for profit.
if no tax of vehicle sales and importation, Proton might die
Hi Guys, beware that the “Bloody Nation” Party is trying to playing some dirty games again & again. The implementation of subsidy will only benificial part of the nation & can never take care of the whole nation. Worst is the “Bloody Nation” are trying to divide “The Rich & The Poor” among the entire nation, which normally not a common practice for a ruling government.
Foresee something like the following will happed
1) 1st National Car (“P” Brand or so called Paralyzed Brand) : RM A.AA / liter
2) 2nd National Car + Rebadged Brand : RM B.BB / liter
3) CKD Car : RM C.CC / liter
4) CBU Car : RM D.DD / liter
Can someone see the plot behind the scenario?
Category 1 & 2 is well plan for parts of the nation ONLY!
Category 3 & 4 is to tell the other parts of the nation to support Category 1 especially.
Come on “Bloody Nation” Party there is always a better solution for considering of open the automotive market to let the entire nation to enjoy a better fuel efficient technology car equipped with a lots of safety features like others country. The nation don’t mind floating fuel prices market as long as the fuel efficient car at its reasonable price tag as compared to now. A lots more choice out there compared to now, just because still need to take care of the never growing “Paralyzed Brand”. The nation are suffering for the past 20 years until now, even the future?
I am sure Malaysia as a oil producing country has a lot more better position & situation to find a equilibrium point in floating fuel price compared to other countries.
What impressed me most is at the end of the day, the “Bloody Nation” party just buying time to work hard & cracking their head how to fuel up some “special tanks” rather than thinking of long term solution & care of the entire nation. Just look at others, why others can implement & survive, not Malaysia?
Where is the problem & where is the root cause?
Yesterday our DPM Najib said in Indonesia, they have discussion with Indonesian G on how they revise the fuel subsidy structure (although the recent hike in fuel at Indonesia still lower than our fuel price.) He said about cash insentive. Maybe this what they will do. Time to stockpiling those petrol my friend. Take out your drum barrel. 2 months 2 go.
===MY SPECULATION====
In my opinion, these are the methods probaby introduced by G should what PM indicates is true (the the new fuel price will take effect immediately):
1) Pricing based on Engine Displacement- easier to implement since all Road Tax stickers displayed, can determine the CC of the engine. Issue: Enforcement and authority at the petrol pump. Pump attendant can always cheat/or bribed in verifying the CC of the engine.
2) Price hike for all, Claim back later- The subsidy will be provided in the form of tax rebates to be made during tax-filing. For the lower income group who are not eligible for income tax, petrol receipts are claimable from a specific new government agency to handle the petrol subsidy for the needy. The agency will not approve claim to taxpayers who already earned the rebate. Issue: cheating and tampering of the receipts, corruption.
3) MyKad Verification- MyKad is used to verify the income capacity of the buyer and linked to LHDN’s tax return database. Issue: Cost to install the MyKad reader at stations.
4) Incremental unsubsidized portion based on fuel amount- Example:
First 10 liters- RM1.95 per liter
Next 11-15 liters- RM2.05 per liter
Next 16-20 liters- RM2.10 per liter
Next 21-25 liters- RM2.15 per liter
Next 26-30 liters- RM2.20 per liter
The rest >31 liters- RM2.25 per liter
Issue: People who only travels nearby, will fuel up the least at each petrol station. Unfair to the needy who travels a lot.
5) RON 99 and RON 95 price differentiation
Issue: Rich can also opt for cheaper RON95 price.
Just my 2 sen.
Now just how the hell are they going to implement something like this?
I’m sure I can find a retired or student family member to pump petrol for the rest of us.
?????
WTF?? Poor man vs Rich man?
how to define?
Looks like a plan to step backwards to me here, and the worst is, the g is making the income gap wider. While the poor is “shielded” from the impact of oil prices, the rich who is now exposed to fluctuation market prices, would have to work harder, or charge whatever biz he is in higher to the buyers/consumers, in order to sustain his lifestyle.
The poor will forever remain in that income group, unable or afford to move up, and we will have a nation of high poor income segment, and a small elitist well to do income group. We are heading towards indonesiana-lism !!! Insane!
A well represented think-tank need to be set-up to discuss on this issue. Not a handful of kampung politicians alone. The Committee must be have professionals who are well verse on the effects of market strategies etc.
Run Malaysia as if it is a company. Revive Malaysia Incorporated !!
Hi,
Yes, Revive Malaysia Incorporated !!
Due to the short time taken to come out with this policy, my fear is that it may be half baked and subject to review when it cannot be fully implemented.
Our energy crisis actually started long ago when the first IPP agreement was signed, giving the IPP’s cheap gas and making TNB buy expensive electricity.
Our govt has never paid attention to fuel, and was (and still is) living in a dream world where subsidies can go on for ever. I suspect that they do not have the expertise to develop these policies and that’s why we are in this rut. Civil servants go on many study tours but come back with nothing. Politicians dare not take away anything from consumers for fear of losing popularity (more so after the last GE)
What this new fuel policy is, and how it will be implemented. Let’s all wait for just a few days more.
ok i’m going to take a stab here and GUESS that they might implement this via an income tax rebate. how else is the petrol pump attendant going to know how much you earn (i.e. “need” vs “use”)? any card based system would require change in infrastructure and that is both costly and time consuming. not a very agile or popular move.
Hi,
I notice, its very contradicting for the very same forumers in here (and other threads before this) wants the subsidy to be totally abolish whilst in the same time complaining the move the big “G” is doing (fuel rebate system). As usual the “mini-parliament” is on the move again. As we have discussed before (in at least 4 threads before this) that MyKad system is the most applicable system to implement fuel control. Now, because the “mini-parliament” complaints this and that, MyKad not good bla bla bla, now the big “G” came out with a far stupider idea; the half-baked fuel rebate system. Good good, the “mini-parliament” who started out all the commotion now we end up losing up as well. Its time for Tun Dr. Mahathir to return and fix things up. We don’t have much fuel price problem then because fuel-sudden-hike was not a big problem (except for the OPEC 1988 fuel crisis).
Just my 1 Ringgit and 55 cents (after fuel-rebate-system)
Kudos to the robin hood government!
Reducing subsidies, increase my pay la..
Then tat will be sorry for business man..
See..Typicall income for fresh gratz 1,800? say 2,000
They declare 2k to tax…but they can only buy a maybe maximum Vios/City.(It really happens,zzz)..no house..
Businessman, borang B, hire-purchase under company, tolls under company, almost everything. Maybe their personal borang BE, they only declare 2k, just enough to pay a condo repayment. But the car, probably a BM?Mer-c?
Just mm about it…nothing to offend rich man..
(MM:Mind Masturbation)
By the way, i think i deserves the subsidy since i paid…at least 100% for AP?Just think..zzz
Yet, they’re declaring the price according to international price affair..
Why not they consider they had collected 100% from us, worst fact, we’re producing petrol?
Brunei can do that, becoz they r selling their car at it price..I don’t mind..
I don’t mind to pay extra for petrol,says i don’t give a f on it if they sold me my Altis at 65k..
Wish Malaysia can go back to the fifties,or sixties?..no tax on mobile.
Income tax rebate?
How smart. Now the rakyat gets to finance the government????
Income tax rebate wont work.
How many of the lower income group can pump UNSUBSIDIZED petrol only to wait a year before they can get thier money back???
Besides how would our IRD know just how much petrol you need? What if you are lower income and you need to drive long distance to work? Man you are really fraked up then……
again, take away the import car tax, tol, and let the malaysian enjoy the lower price car (instead of paying funding to Proton, which only makes money for few people) and the g no need to subsidize the petrol anymore, and no lost for g anymore, and improve petronas margin! What a great idea to benefit the Rakyat, and Petronas, and now we will see what happens to Proton. Our whole nation suffers for Proton!
“The keyword of need rather than use indicates that a person with high income, despite choosing to use a very fuel efficient car will still not qualify for subsidies. ”
—————-
Great..
can’t wait to see what type of MASTER plan u’lll come out with… if no good, i already know what to do in PRU13.. just wait
All this talk of subsidies is just a mask for an increase in fuel prices.
Headlines should be “Fuel Price To Increase”. Dont be fooled.
Its interesting to see how the govt can waste the public’s money to implement 2 tier subsidies on petrol. They gonna say foreigners cant buy other subsidized goods like sugar, oil etc. when they come visit Malaysia? What a farce. Piss off the visitors so they dont spend foreign dollars in our country. Brilliant Move.
Only way to fix is to reduce demand, fix the public transport system. Whatever happened to the LRT from Puchong to KL? Doesnt that use electricity? Join up all the LRT stations together instead of forcing commuters to walk to one another. How many months of subsidies is that gonna cost huh?
obviously.. the keyword here is ‘fast plan’ bro.. i hope they’ll think of long-term solutions too..
no problem on removing the subsidies. just remove the high taxes on new car purchase!!!!! my car cost me RM80k and i pay RM1000/month! the same car is only RM50k in langkawi.
what u (& everybody else who’s asking) will do if G remove the car tax in the near future? sell your ‘expensive’ car? for how much?
say u bought $80k plus car 2 years back with 5 years installment, suddently the G abolished the taxes & now the brand new car is selling $50k.. what happen to u? u want to sell that car to get cheap car? u’ll loss a lot my bro..
it’s great for ppl who already completed the installment & a 1st buyer, not anyone who recently bought a new car… but of coz, in long-term it is a good move..
Will anyhow the g is abolishing the import tax of imported car?Wat advice will u give if i’m heading a new one?will kill me if they really do it.Ya, P1 really kill rakyat..Initially, ‘he’ was just thinking of making the macro economy better by looting your choice on purchasing foreign car, and end up lotz of problem+high maintenance frequency on p1. Then now because it was implemented, and any reducing on import tax will results in used car company closing up(Immediate effect), new buyer never change their car until the repayment is done..
If: P1 was manufactured well, no problem at all..we would just go for it, don’t even bother about foreign car..
but: wracking sounds, parts failure (which rakyat were brain washed tot it was ‘normal’, or ‘ok la’)
but: end up, consumer is ok with it, where the g was very happy since then enjoying the extra charge on tax, now reducing subsidies, n..wat next?
Basically everything was not benefiting the rakyat..n who knows?probably it was bcoz thoz who’re suffering by P1 were thoz who made the most contribution to Malaysia Macro economy. Wat was good of a g who only cares about their macro eco, but not the rakyat(micro eco)?
osh_kosh said,
June 3, 2008 @ 2:22 pm
“The keyword of need rather than use indicates that a person with high income, despite choosing to use a very fuel efficient car will still not qualify for subsidies. â€
—————-
Great..
can’t wait to see what type of MASTER plan u’lll come out with… if no good, i already know what to do in PRU13.. just wait
………………………………………………………………………………………………….
we had did it on 12,we gave them awareness..but don’t forget, the oppos were supposed to participate in this decision making.They’re not noob..But blind by other benefits..
says: Altis 1.8E – 109,900-KL
says: Altis 1.8E – 109,900 – KL
68,738.99 – Langkawi
Diff – 41,161.01
Round down 40k/10years/12months
RM333.00/month
Who wants more?
If they don’t charge high on import tax,
Just reduce any subsidy,
u’re welcome..