[UPDATED] Raise RON95 price by 10, 20 sen instead of fully removing subsidy: Najib

KUALA LUMPUR – Former prime minister Datuk Seri Najib Razak has called on the government to consider increasing the price of RON95 petrol by 10 sen or 20 sen instead of fully abolishing present subsidies.

In a Facebook post today, the Pekan MP opined that by slightly raising the price of RON95 petrol along with the collection of export duty from palm oil and the removal of subsidies for chicken and eggs, the savings and revenue can be channelled effectively to the B40 and M40 income groups despite high inflation rates.

“It’s not appropriate to fully remove subsidies on oil right now with the presently high global inflation rates at the moment.

“However, do not touch the price of diesel at the moment when inflation is still high as it correlates with the cost of production, transportation which could eventually put more pressure on the inflation rate,” he said in his post.

Elaborating further on the palm oil sector, Najib suggested the government increase the export duty and windfall tax for the sector, as the commodity still faces a global shortage and high prices, because the costs are borne by foreign buyers as well as major plantation giants – not settlers.

He said these moves lead to savings that can be channelled to the B40 and M40 group every three months as “cost of living” aid as long as the inflation rate remains high.

“The T20 folks would not bother and are not affected if prices of food shoot up but it will be a major burden for the B40 and a majority of the M40 group.

“The financial aid would certainly ease the pressure from the cost of food for the B40 and M40 group.”

These suggestions, he said, were based on his belief that bulk subsidies, which are being applied now, only benefits the rich.

“The 65% reduction for the sales of RON97 petrol is proof that most of the rich and well-off have switched to RON95 to enjoy the government’s subsidy.

“This is akin to the rich obtaining their necessities from a food bank,” he said.

“Today, the government subsidises roughly RM2.50 for each litre of RON95 petrol which is being sold at RM2.05.

“Which is why the price of RON95 in Malaysia is among the ten cheapest in the world, far cheaper compared to Saudi Arabia and the UAE,’ he said.

As such, Najib pointed out that if someone from the T20 group fills up 50 litres of RON95 for their high-end vehicles, the government subsidises RM125 each time they purchase petrol.

“If the rich fill up their petrol tanks three times a month, it means the government is providing aid up to RM4,500 a year for them, much higher compared to BR1M aid for the B40 and M40,” he added. – The Vibes, June 22, 2022