23 January 2014

A proposal to reduce subsidy spending by selectively restricting the sale of RON95 petrol will be difficult to implement, Tun Dr Mahathir Mohamad said today.

The former prime minister pointed out the complexity involved in qualifying one group from another to determine who should be allowed to purchase the subsidised fuel.
“It is difficult to separate who is considered rich and who is poor,” the former prime minister told reporters at a news conference here.
Yesterday, The Star newspaper reported Federal Territories minister Datuk Seri Tengku Adnan Tengku Mansor as saying that Putrajaya was in the process of devising a scheme to bar the sales of subsidised RON95 to those who could afford the more expensive RON97 petrol.
“We want to impose the increase to only those who can afford it. Someone may drive a (Toyota) Alphard or even a Mercedes (Benz) but they still use RON95 petrol.
“Although this subject was proposed several times in the past but we will be implementing it now after we find a correct method of applying it,” the minister was quoted as saying at Menara DBKL here yesterday by the newspaper.
Tengku Adnan said the matter was still being studied by Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar, but did not disclose details on how the system will be implemented.
According to The Star, Tengku Adnan said the scheme could be rolled out as early as May.
Unlike the fuel price of RON95, which is set by the federal government, the price of RON97 changes according to a “managed float” based on market prices.
The price of RON97 was increased to RM2.80/L this month, while RON95 retails for RM2.10/L following the last fuel price increase in September.


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