RON95 Subsidy Rationalisation to proceed despite global headwinds, says Finance Minister II

Amir Hamzah say the government will continue to be guided by the principle of protecting public welfare while ensuring fiscal sustainability - June 26, 2025

Targeted fuel subsidy framework for RON95 in final stages of design; government pledges to shield majority from burden

THE government remains committed to implementing the rationalisation of RON95 petrol subsidies this year, despite uncertainties in the global economic climate, Finance Minister II Datuk Seri Amir Hamzah Azizan said today.

Speaking after launching the Budget 2025 Initiative organised by SME Bank, Amir Hamzah emphasised that the subsidy reform will mirror the government’s earlier success in rationalising diesel subsidies and will be rolled out with a carefully designed mechanism.

“We are still designing the mechanism, and it will be brought to the Cabinet once we are ready, including the levels at which the subsidy will be applied,” he said.

“In principle, the Prime Minister has also stated that we will not impose a high burden. The aim is to ensure that the majority of Malaysians will not be affected by the implementation of RON95 subsidy rationalisation.”

The government’s policy approach, Amir Hamzah added, will continue to be guided by the principle of protecting public welfare while ensuring fiscal sustainability.

During the tabling of Budget 2025, Prime Minister Datuk Seri Anwar Ibrahim indicated that the RON95 subsidy targeting scheme was expected to begin in the middle of the year, with a projected savings of RM8 billion.

The move is considered necessary given that an estimated 40 per cent of existing fuel subsidies are currently enjoyed by non-citizens and high-income earners.

Savings from the rationalisation programme, Amir Hamzah said, would be redirected towards enhancing public services — particularly in education, healthcare and transport — in line with the government’s commitment to equitable development. - June 26, 2025