The government will introduce a tech-based system for RON95 fuel subsidies, expanding the IC-based checks currently used in diesel subsidy reforms. The aim is to ensure subsidies go only to those in need and to curb misuse that has long strained public finances.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the system, now being developed, will be implemented at petrol stations to support the government’s broader subsidy rationalisation strategy, which balances fiscal discipline with social protection.
Speaking at the Invest Asean-Malaysia 2025 conference, he said diesel reforms have shown early success. As of June 10, diesel supply dropped from 287,000 tonnes to 285,000 tonnes, which he attributed to better control and reduced commercial abuse.
He cited the RM200 monthly cash aid for eligible low-income diesel users who don’t own expensive vehicles as an example of targeted support that works. A similar model will guide the RON95 rationalisation, expected in the second half of 2025, with safeguards to ensure a smooth rollout.
He further added that the Sumbangan Asas Rahmah programme, which currently supports 5.4 million low income beneficiaries, may serve as a blueprint for the new system.
"The philosophy is simple. If you're not eligible, you should pay the full price," said Amir Hamzah. "Foreigners or those who can afford it should not benefit from subsidies meant for the underprivileged."
He also said the government is aware of potential inflationary effects linked to subsidy reforms and is planning mitigation measures, particularly for logistics providers and other key sectors that may be affected.
Ultimately, the finance minister said Malaysia’s future subsidy framework will be built on systems that combine data-driven verification with public trust, to reduce wastage and ensure fairness across the board.
