Fuel subsidy mechanism must go beyond income tiers, says Akmal

 Minister says economic conditions are not only measured by income, but also by reasonable basic expenses and other related factors.

Akmal Nasir said the econony ministry is refining the targeted subsidy mechanism to strengthen the government’s fiscal management, particularly for diesel subsidies. (Bernama pic)

PETALING JAYA:

Targeted fuel subsidies must take into account reasonable household living expenses to ensure the subsidy truly benefits the intended groups, says economy minister Akmal Nasir.

Akmal said the targeted fuel subsidy mechanism should not be based solely on income classifications as household financial commitments vary, reported Bernama.

“The challenge is determining the most suitable threshold or level to apply,” he said after an event in Kuala Lumpur today.

“From the ministry’s perspective, the matter needs to be assessed more comprehensively. We do not want to create classifications that can be disputed from different perspectives.

“Economic conditions are not measured solely by income, but also by reasonable basic expenses and other related factors.”

Akmal said his ministry was refining the targeted subsidy mechanism to strengthen the government’s fiscal management, particularly for diesel subsidies.

On Sunday, Prime Minister Anwar Ibrahim was reported as saying the government would finalise a proposal to review petrol subsidies for high-income earners, subject to further study.

Currently, RON95 petrol is subsidised at RM1.99 per litre for all Malaysians with valid driving licences, capped at 200 litres a month.

In East Malaysia, subsidised diesel is sold at RM2.15 per litre, compared with RM5.17 per litre in Peninsular Malaysia.

Umno secretary-general Asyraf Wajdi Dusuki urged the government to exercise caution in implementing targeted petrol subsidies, saying gross household income alone is no longer a sufficient indicator of a family’s actual financial capacity, particularly in major cities. - FMT