PUTRAJAYA – Retail prices for diesel at petrol stations across Peninsular Malaysia will be set at RM3.35 per litre effective 12.01am on Monday (June 10), as part of the government’s move to implement targeted subsidies.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the retail price of diesel fuel for Sabah, Sarawak and Labuan, however, will remain at RM2.15 per litre.
However, diesel is pegged at RM2.15 per litre under the Subsidised Diesel Control System (SKDS) 2.0, which provides fleet cards to eligible logistics vehicles to mitigate the impact of the diesel price on consumer goods.
Under SKDS 1.0 for land public transport, including school buses, express buses, ambulances and fire engines, diesel remains priced at RM1.88 per litre while subsidised diesel for fishermen is kept at RM1.65 per litre.
The prices, Amir told a press conference at the Finance Ministry here today, are based on last month’s fuel Automatic Pricing Mechanism.
He also said the government is expecting to save about RM4 billion annually from a projected immediate reduction in subsidy leakages due to the implementation of targeted subsidies for diesel.
He added that in 2019, the government had spent RM1.4 billion on diesel subsidies. However, over the course of five years, the government steadily forked out tenfold the amount, with the figure increasing to RM14.3 billion last year.
“Subsidised diesel consumption increased sharply from 6.1 billion litres in 2019 to 10.8 billion litres last year, although there was no significant increase in the number of diesel vehicles.
“Due to smuggling activities, the government lost billions of ringgit to the point where our ability to protect the rakyat’s interests had diminished.”
He added that unsubsidised diesel will likely make illicit trade involving the fuel less profitable.
“The funds saved by the government through this (targeted diesel subsidy) initiative are important to ensure resources can be channelled to other critical sectors impacting citizen’s quality of life, including public infrastructure, healthcare and children’s education.”
When asked if the government will be willing to amend the targeted diesel subsidy rationalisation based on feedback from stakeholders and industry players, Amir said: “Let it run through first, we’ll see how it develops. If there are material gaps, then we will look at it, but the existing data is sufficient for us to go ahead (with the targeted diesel subsidy).”
The increased retail prices for unsubsidised diesel coincide with the roll-out of the first batch of cash assistance under the Budi Madani initiative, which is set to see about 30,000 applicants receiving a RM200 financial aid tomorrow.
“Individuals eligible (for the cash assistance) who have not yet registered, can still receive their monthly cash assistance for June if they apply before the end of the month,” Amir said.
Applicants submitted after June will only qualify for payments starting next month and will miss out on this month’s payments, he added.
Budi Madani is the government’s effort to ensure subsidy allocations are targeted to eligible groups, including individual assistance (Budi Individu), farmers and small-scale growers (Budi Agri-Komoditi) as well as companies and transport vehicles (MySubsidi Diesel).
For more information on Budi Madani eligibility requirements, visit the website or contact the helpline at 1-800-88-2747/03-88824565/03-88824566 or via email, as well as visit any Inland Revenue Board office throughout Peninsular Malaysia. – June 9, 2024