The targeted fuel subsidy for RON 95 as announced in Budget 2019 is set to benefit four million car owners, but they will not be those in the T20 segment or those owning luxury cars, The Sun reports.

“I can say that (owners of) luxury cars, don’t hope to get the fuel subsidies,” finance minister Lim Guan Eng said in response to flak on social media over the possibility that those with luxury cars with a lower engine displacement could capitalise on the fuel subsidies meant for lower income groups.

The targeted fuel subsidy for RON 95 is slated to be introduced sometime in the second quarter of 2019. The scheme will provide a 30 sen subsidy per litre (depending on the price of petrol) limited to 100 litres a month for cars with an engine displacement of 1,500 cc and below, and 40 litres for motorcycles with an engine displacement of 125 cc and below.

It was announced that owners with multiple cars will not receive this benefit. Expected to cost the government RM2 billion a year, the scheme, once implemented, will see RON 95 pricing moving to a managed float for non-subsidised vehicles.

Concerns raised about the scheme following its announcement centred around the point that it would benefit owners of luxury and premium cars with smaller engine capacities, with car models such as the Audi A4 1.4 TFSI, BMW i8 and 318i, Mercedes-Benz C 200 and A 200 and Honda CR-V being eligible, if the criteria was simply based along the lines of engine displacement.

Lim said the subsidy was targeted at the B40 group. “The government initially wanted to target the B40 group only but upon consideration, may extend a bit to the M40 group,” he said, adding that the mechanism of the scheme is being worked out and will be announced later.

On the same subject, domestic trade and consumer affairs minister Datuk Saifuddin Nasution Ismail said that eligibility will take into account the income level as well as the age of the recipient’s vehicle, Bernama reports. “We need to know how many Malaysians still own old vehicles, as every formula we work out has to take into account its implications on the government’s coffers,” he said.