The government has banned all petrol stations within 30 to 50km from the Malaysia-Thailand border and the Malaysia-Singapore border from selling fuel to foreign cars beginning this Friday (30th May 2008) onwards. This would include all petrol stations in Perlis, Kedah, North Perak, Kelantan, and several Johor distrincts. Offending petrol station owners would be fined up to RM250,000 or jailed 3 years or both.

I know that there are some people, especially those who live in the northern states who buy and register cars in Thailand, but drive them around in Malaysia. They would certainly be in a fix as now they would have difficulty filling up their fuel tanks, as even though they are Malaysian and their cars are being used in Malaysia, their number plates are foreign. I can think of a probable but illegal solution they’d come up with: fake local number plates?

This ban is only temporary until a permanent solution is introduced to prevent fuel subsidies from being enjoyed by those who are not intended to receive them.

In the same report by Bernama, Domestic Trade and Consumer Affairs Minister Datuk Shahrir Samad said that the Federation of Malaysian Consumers Associations (FOMCA) has suggested petrol subsidies to be given out based on engine size would be considered. This seems logical as first as the rich would have cars with larger engines, but with the world engine trends moving towards displacement downsizing and the likeliness of the rich being able to access this latest technology in the first place, it is another idea which in practice is not going to be completely effective.

As it is the popular Mercedes-Benz E200K and C200K uses 1.8 litre engines, and the large Volkswagen Passat is available with a 1.4 litre engine. That is smaller than a Proton Persona’s engine in terms of displacement.