ABOUT 40% of car owners in low-income households do not have vehicles registered in their own names, says Economy Minister Rafizi Ramli.
These were some of the findings of the Central Database Hub (Padu) after checks on vehicle ownership data with vehicle registrations at the Road Transport Department.
“Some families registered their vehicles under other people’s names.
“A similar situation also happened when we implemented the targeted subsidy mechanism for diesel,” he said.
“Based on this set of data, there is a huge mismatch seen in certain practices, either through ‘sambung bayar’ (taking over hire purchase payments of vehicles bought by the first owners) or vehicles that were bought under the names of other people,” Rafizi said during Minister’s Question Time.
As such, he said the proposed petrol levy system may cause some of the poorest households to be left out from receiving aid due to a mismatch in the system.
Previously, there were proposals for the government to impose a petrol levy on vehicles when drivers renew their road taxes.
Rafizi said the petrol levy system was one of the three proposals being considered for implementation.
So far, the government believes that the two-tier pricing system is the best method on fuel subsidies.
The two-tier pricing system is the introduction of a subsidised price and an unsubsidised price for petrol.
“We are aware that the two-tier system carries some operational risks at petrol stations. This method can be refined over time,” he said.
Rafizi was responding to a supplementary question by Suhaizan Kaiat (PH-Pulai), who asked about the government’s views on implementing the petrol levy mechanism in the RON95 targeted subsidy system.
Rafizi said the third proposal was direct cash payments to qualified individuals.
But he was concerned that this could lead to price increases and inflation.
“Economists have said that direct cash payment is better because it does not involve petrol station operators.
“But the government sees a potential increase in the prices of goods because when fuel prices go up, traders will use that as an excuse to raise prices,” he added.
Meanwhile, Rafizi said there is no perfect method in implementing the fuel subsidy system.
Hence, the government will choose the best mechanism where the prices of goods will not drastically increase.
“Most importantly, the government will emphasise on its efforts to control the prices of goods and inflation.”
During the tabling of Budget 2025 last month, Putrajaya announced that the targeted RON95 subsidies will be implemented from middle of next year.
On June 10, diesel subsidies were removed in Peninsular Malaysia, leading to an increase from RM2.15 to RM3.35 per litre.
