The government will review the fuel subsidy mechanism!
The government will review the fuel and cooking oil subsidy scheme to make it more targeted, according to a message from Prime Minister’s Department (Economic) Minister Datuk Seri Mustapa.
The current fuel subsidy mechanism has put tremendous pressure on the exchequer. Last year, the government budgeted RM5 billion for subsidies, but now it is expected to cost RM30 billion, which is a six-fold increase.
Although the increase in international oil prices will allow the country to have additional revenue, however, this may still be insufficient to offset the cost of fuel subsidies. The government is currently implementing control order measures for RON95 and diesel, the top price of RON95 petrol per liter is RM2.05, while the top price of diesel per liter is RM2.15. RON97 petrol is floating with the market price, the latest price has been increased to RM3.81 per liter.
Mustafa pointed out that those who can afford to pay more should pay more, and the government’s subsidy should only target the poor. Mustafa believes that the government will implement a targeted gasoline subsidy mechanism, the problem is when to implement it.
