Prime minister Datuk Seri Anwar Ibrahim said the government is in the midst of refining a proposal for more comprehensive targeted fuel subsidies, which will look into the rationalisation of RON 95 fuel subsidies for the high income group, and this is expected to be finalised soon, the New Straits Times reports.
He said the proposal is currently being reviewed by the national economic action council’s (MTEN) crisis management task force, which is chaired by Tan Sri Mohd Hassan Marican. “The proposal was tabled about a month ago by the task force chaired by Hassan. It has since been reviewed, and discussions were held on whether it should apply to the T5, T10, T15 or T20 income groups,” he said.
Anwar said that the ongoing study is aiming to determine a threshold that will not end up burdening the upper-middle income group. “In principle, we agree, but we want to ensure it does not affect the upper-middle class. They are working on it, and I hope it will be finalised soon,” he said.
Economists have previously estimated that excluding the T20 group from the Budi Madani RON 95 (Budi 95) fuel subsidy programme could save the government up to RM1.5 billion a month. Putra Business School associate professor Ahmed Razman Abdul Latif said the savings from this measure could be channelled back as financial aid to those in need, helping those in the low and middle-income groups to manage the cost of living.
Back in 2023, Ahmed Razman had said those in the T20 income bracket would not be severely impacted if they no longer received any subsidies. “The T20 can bear the higher cost of products and services if they are no longer eligible for subsidies as this group managed to recover the fastest in terms of their income and wealth after the pandemic. The tax rate imposed on them is also considered low as compared to other countries and therefore, they can afford such removal of subsidies,” he had said then.
Of course, the question does come back yet again to where the cut-off happens, and what constitutes high-income, or rich. Back in 2023, the department of statistics Malaysia determined that the T20 – or top 20% – represents the top-tier households where the monthly income is higher than RM10,959, a figure that has now been adjusted to RM11,819. In 2024, the classification of T15 was said to be a household income of around RM13,000.
While it sounds like a healthy sum, given the household metric, someone earning that sum for a household with another three dependents might not be having tons of spending power in reality. Ditto the measure in the case of couples – for a working couple, that’s a salary of RM6,500 each if you’re looking at a RM13,000 threshold for households. It’ll be interesting to see where the mark is defined when the time comes.
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Don’t really understand what is government’s long term plan.
They want to remove the subsidies for T20, but at the same time,
1) backward solar policy by switching NEM to ATAP
2) Ban CBU EVs below RM200k CIF
3) Making ridiculous EV CKD rules (80% export oriented? since when our CKD Toyota and Honda ever exported?)
4) slow charging point deployment, missing the 10000 target.
They want to cut your subsidies but reducing your alternatives at the same time, and then call you MAHA KAYA!!!..
Indonesia is providing incentives for 200,000 EV and e-bikes during this oil crisis, and we are doing the opposite. What is our government trying to do here???
The metric should be Nett Income
Which means after Tax applied
the super rich Rolls Royce, Alphards, Merccedes , BMW , etc…has their driver to pump with their own IC . They benefit again ! Fail gov
The biggest flaw with the current T20/M40 classification is that it focuses on gross household income, not actual financial comfort. A RM15k household income means very different things depending on family size, housing loans, location, childcare, education costs and support for aging parents.
Many salaried professionals are not poor enough to qualify for aid, but not rich enough to comfortably absorb higher taxes, subsidy removals and rising living costs. They pay PCB consistently, receive fewer education opportunities or subsidies for their children, yet are increasingly labelled as “rich.”
T20 statistically just means the top 20% of households — it does not automatically mean wealthy. In urban Malaysia today, many doctors, engineers, teachers and dual-income families fall into T20 simply because living costs and housing prices have risen much faster than salaries.
The real issue is that gross income does not reflect disposable income or financial burden, and that disconnect is why many people feel the current classifications no longer reflect reality.
The RICH group here should be the politicians themselves. They get all the petrol allowances no matter how expensive. So, they are shielded but not the working class! What a scam!
Exactly. They are the ultra rich collecting over rm100k pensions every month till they die, paid mostly by the T20 that they are planning to punish. Cut off this ponzi pension and we can easily afford anything.
In Malaysia, breakfast now often costs more than a month’s worth of petrol, a situation that has traditionally helped boost the economy.
However, if petrol prices must be raised to manage costs during the current Iran-USA-Israel conflict without causing public anger, the government could propose a short-term, targeted subsidy mechanism.
This would enable businesses to plan accordingly based on a clear policy roadmap.
This is the part many policymakers fail to understand. A professional earning above the aid threshold is not automatically “rich.” Many of us are salaried workers with fixed monthly commitments — housing loans, car loans, utilities, children’s education, insurance, and higher income taxes deducted consistently every month.
My daughter achieved good results but did not receive scholarship assistance. At the same time, because we fall into the so-called T20 category, we are also gradually excluded from subsidies and support schemes. It creates a situation where many middle and upper-middle salaried families feel left out — paying more into the system, but receiving very little back.
T20 statistically means top 20% of income earners. It does not necessarily mean wealthy, financially free, or living luxuriously. Many professionals today are simply trying to maintain a stable life in increasingly expensive urban Malaysia, not living like high-flying businessmen with multiple companies and investment assets.
Gross household income alone is no longer an accurate reflection of actual financial comfort or disposable income.
Either T-groups are given their fair share of the subsidies or they pay a lot less in terms of their income tax. Period!
my monthly salary is RM12k , i am paying around 3.5k monthly installment for a BMW 5 series . the trehshold to become T20 is RM13k, so it is good that gomen will ban the greedy and wealthy T20 from receiving budi95 subsidies. i am glad and grrateful to be classified at B40.
forgot to mention my annual bonus is usually around 3-4 months salary.
I am a salary earner, averaging RM40 – 45k monthly. I cannot afford a BMW, used to drive an Accord for 11yrs. Maybe you can teach me how to manage my finances. Sold my car and travel by Grab. Don’t drink or smoke, gamble or womanise. Pay my monthly house installment, living expenses and save the rest. I technically cannot afford a BMW no matter what calculation i run. Lots to learn from you.
Not to mentioned we pay 6 figure tax every year, and get penalised. I don’t think it’s fair. Reduce subsidies for us, they should reduce our tax too.
your total annual household income averages 800k+ and you still cannot afford a nice car, then you must be literally burning your money.
Oh, yah. Forgot to mention, my wife earns RM22k and she can only afford a Honda City. She also has 2 businesses running on the side. Check your calculator batteries.
Salary 12k. After tax is around 9k net. Use 3.5k to pay for car, not including fuel, tyre, maintenance upfront cost which can be 4k-4.5k per month.
Now you left with 5k. Monthly food, mortgage, groceries run, yada yada, parents, medical etc.. do you think its enough? Not to mention if you have kids :) , been there.. no saving at all, could go negative as well. I can tell youre bluffing anyway.
fuel, tyre, maintenance upfront cost which can be 4k-4.5k per month?
what nonsense.
its a relatively new car which means scheduled maintenance only , repairs are covered under warranty. tyres can last roughly 2 years and can be skimped on during next change. fuel is 200 liters of budi 95 since its a hybrid which is fuel efficieint suffices to drive 2500km monthly.
Husband and wife with kid(s) earning total RM13k in Klang Valley also considered T15 but paying high income tax. Our classification of the T bracket is too skewed. Those with total income of RM10-20k really screwed. Considered high income and pay high taxes but can’t enjoy any benefit
where will the cut-off be? the cut-off will be anwar’s mandate. doesnt matter if umno ministers sabotage or stab him from the back, he is the top leader, the final decision maker, his failure to control his cabinet and to contain the threats from the likes of umno youth has marked the end to his shameful tenure
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“Targeted subsidy scheme can save country RM20b annually – Muhyiddin”
(From Bernama, 31st July 2022)
‘The government can save RM20 billion a year by implementing the targeted subsidy scheme, said National Recovery Council (NRC) chairperson Tan Sri Muhyiddin Yassin.
According to Muhyiddin, at the moment, only 20 percent of the subsidies provided by the government were taken up by the B40 group while the rest was enjoyed by groups which did not deserve it.’
Vote for the other coalition & the T20 will still be treated as a punching bag.
Just remove the subsidy and let everyone pay pump price. This will force people to be thrifty, and avoid wastage such as unnecessary weekly excursions back to hometown, or vacationing every weekend, spending money they never had.
Our classification of T10, T20 is FLAWED!!!!! 14k is T20???? Really dumb arse. DO this and my vote is for UMNO.
They should be classifying MPs and politicians as RICH, not the working class.
HuHu rm20k n aboved monthly income clubbers won’t get budi95 soon
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Genuine rakyat Malaysia know that the main purpose of government subsidies is to help alleviate the financial burden of the lower income citizens to counter the higher cost of living. It can’t be that the financial burden of the low income citizens is lighter than that of the high income citizens when it comes to the cost of living. If you don’t know this, you must be a fake rakyat Malaysia..
So the low income group should buy cheap Malaysian cars, stop going for holidays every year, stop eating out everyday. I pay 6 figure income tax and i cannot afford to go on holiday. But B40s are busy flying around, shopping and buying expensive cars with money they never had.
Nah, its a technique to gain voters. As you know, 80% of the voters are B40 & lower M40. If this current gov execute this sh#t ideas, i would like to demand that my tax to be reduced. I earned 13k month, pcb saja > 1.2k – 1.5k , take home net 9.9k. I could use the extra reduced pcb to pay my fuel, why should i care about the B40 anyway? They get what they deserve.. just because i work harder and get luckier, doesnt mean i have to take care of the lower class which is none of our business anyway, yet they say we are “rich” and wanted to remove our subsidies, wow.. its like im begging to my own charity. Anyway.. this gov really stir up something, its theatric.
.. don’t want LHDN to find you & if you don’t want to care about the B40, then just move away to a tax haven..
Before pointing someone as a fake Malaysian, u need to learn some basic economic by ray dalio. SUBSIDIES is a tool to make the B40 (unfortunate in disguise of laziness/unlucky) work and continue to work. While the top tier bracket, we know this and close one eye for the sake of Malaysian even we enjoyed only 1 subsidy which is FUEL and we used that to go to work to find MONEY and ENJOY some for our hardwork and family, and now the crazy politicians forcing us to close both of our eyes.. nuts! If youre BUMI, you got another home price subsidy BUT still that is NOT ENOUGH compared to B40 package from our TAX. Dont forget about hospital bills! If not because of the T20 and top M40, the bill will go booommm and B40 will cry to change the gov. :). Negaraku! I missed Najib now, even he stole the goddamn money, still not my money!
.. that you mentioned about missing PMVI, who is serving time for the misappropriation of RM42 million, which is part of a RM4 billion loan to SRC International from KWAP, the retirement fund for civil servants, which is in turn made up of contributions from the deductions of civil servant salaries, that are derived from tax payers money.. If you say that it’s still not your money, then you are not a tax payer..
Ya lar…. We pay the most taxes and yet we always get nothing.
Especially when think about those who avoids taxes like businessmen even some pretenders who applies for OKU to get more benefits.
Sooner or later, we’ll all leave or setup accounts overseas for income.
I am a salary earner, pay 6 figures tax anjualy but i cannot afford a luxury car. Sold my 11 year old Accord and now the only thing i can afford is overpriced Japanese cars or CCP cars. And now you want me to pay full price for petrol while B40 and M40 drive luxiry cars.
You are joking right? Household RM60K per month, cannot buy luxury car like BMW? Serious? You burn all the RM notes monthly or your lifestyle is just too high? High expenses.
Is T20 still tied to PADU, which requires full asset declaration?
This causes fear of splitting Malaysian unity during this crisis time.
The Rakyat wishes for more transparency regarding petrol prices: 1. Overhead Cost, 2. Fuel Cost, 3. Subsidy Cost. As simple as that, Does this work?
The claim by putra business school of saving 1.5bil from cutting T20 subsidy.. how does he comes to that figure ? what is the basis of his claims ?
I think it is not fair to any sector of malaysian to be denied common benefits. These T20 are the ones that pay the most income tax. whereas B40 and M40, have much lower % of those actually pay income tax.
Now government should focus on using less fuel rather than the RM numbers alone. A more just policy is to restrict use of vehicle in bandaraya with high concentration of public transport such as KL, JB and Penang island. restriction by plate number (odd or even) and reduce access the 2days per week will see difference in amount of fuel use and reduce congestion in these areas. it also promotes use of mass transports such as buses, trains, mrt ,lrt, bus sekolah and perhaps Grab as well. it is fair since it does not discriminate against any group of rakyat.
I would like to propose Malaysian MPs and politicians should reduce all their hefty allowances first (petrol, holiday, house etc). Why nobody in the PMX govt is talking about this? Don’t dare to cut their own allowances and benefits the poor? Why must they go and chop the so-called T20 heads to fund their own allowances? The really rich group here they should be looking at is the MPs and politicians not the working class!
They didn’t tell you about the 6 figure pensions every month for life they get after they retire? T20 is funding the politicians luxurious retirement haven.