KUALA LUMPUR (Nov 5): The top 15% (T15) income group to be excluded from the proposed targeted RON95 petrol subsidy will not be solely defined by the Household Income Survey, said Finance Minister II Datuk Seri Amir Hamzah Azizan.
The government will consider additional criteria beyond income to gain a more comprehensive view of the T15 group, Amir said, emphasising that the approach aims to cover the majority of people, including the middle class, in facing the challenges of rising living costs.
"The government is still evaluating the criteria for the T15 group in targeting RON95 subsidies, and it will not be strictly tied” to the definition under the income survey done by the Department of Statistics Malaysia, the minister told the Dewan Rakyat during ministerial question time on Tuesday.
The shift from a blanket subsidy to a targeted subsidy for RON95 petrol is part of the government’s subsidy reform announced by Prime Minister Datuk Seri Anwar Ibrahim during the presentation of Budget 2025 last month.
However, he did not provide details of the retargeting, and the government has been urged to reassess the classification of household income to prevent those in need from being excluded from the subsidy.
On Tuesday, Amir said that the Ministry of Finance is currently considering a tiered pricing mechanism for the RON95 petrol subsidy, similar to the model used for retargeting diesel and electricity subsidies.
"The ministry is also considering the use of MyKad and e-wallets as a new mechanism for delivering RON95 petrol subsidies," he added.
Under the diesel subsidy rationalisation implemented in June this year, more than 140,000 individual recipients and 65,000 agri-commodity recipients were approved under the Budi Madani initiative as of the end of October, with a total payment of RM160 million.
The implementation of the targeted diesel subsidy has led to a sharp drop in retail diesel sales, decreasing by about 25% or nearly seven million litres per day, while commercial diesel sales rose by almost 50% or four million litres per day.
"The targeted diesel subsidy has generated around RM600 million in savings per month, while the inflation rate remains under control," Amir noted.
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