A target fuel price subsidy mechanism is coming soon, using engine power data from JPJ – KPDN Minister

Vehicle engine power data from the Road Transport Authority (JPJ) will be one of the sources used by the Malaysian government to create a targeted fuel subsidy scheme to determine which users are eligible. Future targeted fuel subsidies are almost ready. report Bernama.

The ministry has discussed the matter with the Finance Ministry, Economy Minister Rafizi Ramli and JPJ, according to the country’s minister of commerce and cost of living, Salahuddin Ayub, minister of commerce and domestic cost of living, according to the report.

“In terms of data, they are almost ready to go to the prime minister on how we can implement this targeted subsidy,” Salahuddin said, adding that the JPJ database can identify people eligible for targeted benefits based on motivation. capacity of the vehicle they own.

The targeted subsidy proposal was presented at the National Cost of Living Council (NACCOL) meeting, held last Tuesday and chaired by Prime Minister Datuk Seri Anwar Ibrahim. maintain, Bernama report.

“The Prime Minister has given instructions to [the targeted subsidy mechanism] studied. But for now, the government is continuing the existing policy, which is to keep us from withdrawing [subsidies] or raise any tax rate that we feel might burden the people, so the policy will continue until the cabinet decides on [targeted subsidy] later,” said Salahuddin.

At the end of last month, the prime minister gave the relevant government ministries a two-week deadline Discuss and analyze the problem targeted fuel subsidies, including fuel subsidies.

“I have no problem with subsidizing people, especially the poor. But our full explanation, as it comes out, is that this sub should be targeted. On the other hand, just like in the case of fuel subsidies, subsidies benefit everyone, including the rich,” Anwar said at the time.

The continuous development of new vehicles means that vehicle capabilities are not closely tied to engine displacement, and therefore it will be necessary to establish a distinction between vehicles that do not. only by engine power as a measure.

For example, the third generation Perodua Myvi upgrade with 1.5L engine priced from RM50k when launched in November 2021, while W206 Mercedes-Benz C200, also 1.5 liters capacity, priced at RM288k when launched in February this year. Each of these vehicles varies greatly in price, market positioning and, therefore, the cost sensitivity of the customers each vehicle is aimed at.

Fuels currently subsidized in Malaysia include RON 95 gasoline and diesel, with a ceiling price of RM 2.05 per liter of RON 95 gasoline. introduced by the Malaysian government in February 2021. The price cap for the Euro 5 B10 and B20 diesel fuel is RM2.15 per liter, while the Euro 5 B7 diesel is priced at RM2.35 per litre. Meanwhile, unsubsidized RON 97 petrol costs RM3.35/liter as of December 22, 2022.