Economy minister Mustapa Mohamed recently said in an interview with Bloomberg that the Malaysian government has begun work on replacing the current blanket fuel subsidy scheme with a more targeted approach. This is in light of rising government spending to deal with higher living costs faced by the rakyat.
“The target is to ensure that those who need subsidies, will get the subsidies. The sooner it is done, of course, it will relieve pressure on the government’s budget,” Mustapa said in the interview. A targeted subsidy will also apply to non-mobility essentials like cooking oil, the report stated.
Last Friday (June 3), the finance ministry said in a pre-budget statement that the government’s expenditure is expected to increase significantly by about RM30 billion due to unanticipated subsidies for fuel, cooking oil, chicken and eggs as well as a flood relief. More recently, on June 6, prime minister Ismail Sabri Yaakob said the total subsidy bill this year could exceed RM71 billion.
As for the how much the government is forking out to subsidise fuel, it was previously reported that the total bill is expected to hit RM28 billion for the whole of 2022, more than double the RM11 billion recorded in 2021. As per the latest fuel price update issued on Wednesday, RON 95 petrol and Euro 5 B10 remain capped at their ceiling prices of RM2.05 and RM2.15 per litre respectively, while RON 97 petrol hit a new record high of RM4.72 per litre.
Mustapa’s comments to Bloomberg reaffirms what he said back in April this year, although there’s still no indication when a targeted subsidy scheme will be implemented or how it will be done. We posed some possibilities in another post that touched upon international trade and industry minister Datuk Seri Mohamed Azmin Ali’s statement where he said, “those with a BMW cannot receive the same subsidies as those with Kancil.”
Given what we’ve heard from the government so far, a targeted fuel subsidy scheme is the (very near) future for Malaysia. Barring any backtracking, what do you think is the best method to implement such a scheme? Share your thoughts in the comments below.
Looking to sell your car? Sell it with Carro.
Lol
on 
Eat My Smoke
on 
sohai
on 
Casual reader
on 
:)
on 
Zahidkor
on 
Celup King
on 
Jurassic World
on 
dong gor
on 
Wise
on 
Rakyat Malaysia
on 
john
on 
Qzam
on 
CKL
on 
Bieight8
on 
Right?
on 
Kam
on 
Pol
on 
Kent
on 
Ah Chong
on 
Why so scare?
on 
Nono
on 
Andrekua
on 
ThePolygon
on 
KL Commuter
on 
KS
on 
ROTI CANAI
on 
Bill
on 
CKL
on 
High Horse
on 
Ling kwang chun
on 
Ling kwang chun
on 
Francis Lim
on 
My brain will burst
on 
Mr. Sotong
on 
Ken
on 
AI-generated Summary ✨
Comments largely focus on the proposal for targeted fuel subsidies, with many supporting the idea of implementing an efficient system using IC cards or apps for eligibility and quota management. Some suggest tiered subsidies based on income, vehicle type, or location, emphasizing fairness for B40 and rural populations. Several commenters criticize the current subsidy system for being prone to abuse, unfair advantages for the wealthy, and lack of transparency. Many advocate for simplifying procedures, using data from JPJ or LHDN, and leveraging technology to ensure subsidies reach those in need. A few express skepticism about enforcement, potential corruption, or reallocating funds towards public transportation or EV initiatives. Overall, the sentiment is in favor of a fairer, more targeted approach to fuel subsidies.