Rafizi: Tailored RON95 Subsidy Coming In Second Half Of 2024

The Malaysian government intends to introduce a tailored subsidy structure for RON95 in the second half of 2024, according to the Minister of Economy YB Rafizi Ramli. The goal of this tailored subsidy structure is to ensure that subsidies are appropriately directed towards those who need them the most, plus making sure that public resources are being used efficiently.

Rafizi underscored the significance of circumventing redundancy concerns and stressed the government's shift from prior methodologies. He drew attention to how unfair and unsustainable it is to have a system where 53% of all petrol subsidies go to the T20 group. Currently under extensive subsidies by the government, the RON95 petrol is marketed at only RM2.05 per litre – one of the cheapest in the region.

During the table of the Malaysian Budget 2024 last month, Prime Minister Anwar Ibrahim emphasised the gradual rationalisation of diesel subsidies as part of larger efforts to rationalise subsidies, which cost RM55.443 billion in 2022.

Rafizi added that the government needs to come up with creative solutions to deploy resources, cut down on leaks, and get rid of waste. Among the initiatives tabled by the Minister of Economy is this targeted RON95 subsidy, which was introduced with the goal of improving tax collection in order to make up for revenue shortfalls. He also emphasised on the important role that the Pangkalan Data Utama (PADU) socio-economic database play in fulfilling this subsidy initiative, so that it can detect the possible changes of social assistance and the rationalisation of subsidies.

Source: FMT