RON95 Fuel Subsidy Implementation Now Under MOF’s Control

Samuel Chua

19th May 2025 - 2 min read

The Ministry of Economy has officially handed over responsibility for executing the targeted RON95 fuel subsidy to the Ministry of Finance, marking a significant step towards the long-anticipated rationalisation of fuel subsidies.

This transfer of responsibility suggests that implementation may be drawing closer, following months of Cabinet-level discussions.

Economy Minister Datuk Seri Rafizi Ramli confirmed that the matter is no longer under the purview of his ministry.

“The decision regarding the targeted RON95 subsidy has been completely transferred to the Ministry of Finance. That was the decision of the Cabinet.

“From the Ministry of Economy’s side, we have brought this matter to the Cabinet four times, and the current position is to await action from the Ministry of Finance. They will be managing the entire RON95 subsidy process from now on. We must wait for their official announcement,” he said.

The move reflects the government’s intention to centralise the subsidy rollout under the Ministry of Finance as part of broader fiscal reforms aimed at strengthening public finance management.

Rafizi previously said that the targeted fuel subsidy would be introduced in two stages. The first involves operational execution at petrol stations, while the second focuses on identifying eligible recipients in the B85 income group, which includes the bottom 85% of earners.

“The back-end processes,” Rafizi said, “will still be handled by his ministry. This has been brought to the Cabinet for approval.”

Initial discussions between the two ministries outlined a phased implementation approach, with eligibility assessment to be finalised by the Ministry of Economy and presented to the Cabinet for approval.

During the tabling of Budget 2025, Prime Minister and Minister of Finance Datuk Seri Anwar Ibrahim stated that the government intends to implement the targeted RON95 subsidy by the middle of 2025.

The initiative is projected to save the government RM8 billion, which will be channelled into programmes aimed at improving the well-being of the wider population.

Importantly, 85% of Malaysians are expected to remain unaffected by the new structure, which is designed to ensure that assistance reaches those who need it most while reducing unnecessary expenditure.

(Source: NST)

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