Government has no intention of allowing vehicles owned by non-citizens to enjoy RON 95 petrol subsidy

The government has no intention of allowing vehicles owned by non-citizens to enjoy the RON 95 petrol subsidy, says the ministry of economy. As reported by Bernama, this decision is in line with the government’s goal to strengthen the country’s fiscal position as outlined in the 12th Malaysia Plan (12MP), or Rancangan Malaysia Ke-12 (RMKe-12).

“The implementation of the RON95 subsidy in 2025 is expected to provide savings of RM3.6 billion to government expenditure, or a reduction of 21.9% to the total subsidy expenditure, if the subsidies are only given to the B85 group and citizens,” the ministry said in a written reply on the Parliament website.

“By ensuring that the targeted RON95 subsidies do not involve non-citizens, it will give savings of RM0.3 billion (2%) to the government,” it added. This was in response to a question posted by Abdul Latiff Abdul Rahman (PN-Kuala Krai) regarding the ministry’s plan to allow Brunei Darussalam vehicles to use RON 95 in Malaysia.

The government will implement the targeted RON 95 subsidy in mid-2025 which will affect 85% of Malaysians with those eligible for subsidies determined based on the Basic Expenses for Decent Living (PAKW) indicator launched by the Department of Statistics Malaysia (DOSM) in early November.

Unlike the previous B40/M40/T20 system, PAKW is meant to be tailor-made rather than being a one-size-fits-all approach. The previous system was based on gross household income, or how much a household’s members collectively made. However, every household has a different cost of living, even if they have the same gross income.

With PAKW, the government uses data to determine how much it costs for Malaysian households to afford three main things: essentials such as food, desires such as entertainment and participation in communal activities. The MyPAKW calculator is available as a guide for households/individuals to understand the basic expenditure of decent living.

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