19th May 2022 - 2 min read
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz has remarked that a substantial portion of the subsidies provided by the government is actually enjoyed by the T20 income group. This is due to Malaysia’s blanket approach in providing the benefits to all levels of society, regardless of income levels.
To illustrate his point, Tengku Zafrul said that although the overall subsidies for 2022 are expected to exceed RM30 billion, more than RM15 billion will likely benefit the high-income group. Even more specifically, he also shared that for every RM1 of petrol subsidy, 53 sen will go to the T20 group, while only 15 sen will be utilised by the B40 group.
“In Feb 2021, the subsidy for petroleum products borne by the government was only RM200 million. However, by Jan 2022, it was RM2 billion and in March, it was more than RM4 billion,” Tengku Zafrul further stated, adding that the government has also allocated RM700 million for electricity subsidy for the first half of this year.
In light of this situation, the government is now studying ways to improve the electricity and petrol subsidy mechanisms so that they are more targeted and focused on the financially vulnerable group. This way, the subsidies will benefit those who are truly in need.
Finally, Tengku Datuk Seri Zafrul stated that the government will engage with relevant stakeholders to discuss the targeted subsidy approach, and present the findings to the Cabinet in due course.
(Source: Free Malaysia Today)
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