PETALING JAYA: The implementation of targeted subsidies that is currently underway is not expected to increase costs for existing industries, said deputy finance minister Ahmad Maslan.
However, he said, the government will still emphasise the importance of implementing and communicating effectively with the industry to prevent any shocks to the economy.
“The current fuel subsidy is aimed at reducing the impact of the increase in the cost of living of the people, especially for the low-and middle-income groups.
“In order to continue protecting consumers from the effects of the increase in the price of crude oil in the global market, the government is maintaining the ceiling price of RON95 petrol at RM2.05 per litre and diesel at RM2.15 per litre even though the market prices of both products have exceeded the set price ceiling,” he said.
Meanwhile, he explained that in relation to tax reform measures, any changes in tax-related policies will take into account the impact on the economy and the cost of living.
“Accordingly, the government is always monitoring the current economic situation and considering fiscal measures that will suit short and medium-term needs.
“In addition, the government will continue to engage all stakeholders to conduct a study on the aspects of reforming the national taxation system,” he said.
Ahmad said the government will ensure that when the targeted subsidies are implemented sometime in March 2024, the government will start with diesel first and then RON95 in the following month.
“To ensure prices of goods do not rise, the diesel subsidy for vehicles carrying goods will remain, so there is no reason for the price of goods to rise because the (diesel) price remains at RM2.15 per litre.
“For private vehicles in Sabah and Sarawak, we maintain (the diesel price) at RM2.15 per litre, and for fishermen we also maintain the price at RM1.65 per litre.
“For public transport, such as school buses, the price will remain at RM1.88 per litre,” he said.
Ahmad said what is important is the enforcement of the law during the implementation of the targeted subsidies.
“The domestic trade and cost of living ministry has many officers to combat leakages,” he said.
Ahmad was replying to a question from Nik Abduh Nik Abdul Aziz in the Dewan Negara pertaining to whether subsidy rationalisation measures and tax reforms will have an impact on low and middle-income groups.