KUALA LUMPUR — Setting the fuel subsidy income threshold for higher-earning groups is among the government’s key challenges to prevent sudden “shocks” to those who still need assistance, Economy Minister Akmal Nasrullah Mohd Nasir said today.
He acknowledged that there are those who are not fully prepared to “transition away” from fuel subsidies, even if they fall into higher-income classifications.
“These are among the key issues being discussed in determining where the dividing line should be drawn between those who ought to receive subsidies and those who may be better removed from the system.
“One of the greatest challenges is determining where exactly the threshold should be set, and this will require consideration from various dimensions,” he said at a press conference reported by local media here.
Akmal also said that consumption would be one of the other factors taken into account rather than relying solely on household income.
The minister was speaking after an event at the Economy Ministry in Putrajaya.
Yesterday, Prime Minister Datuk Seri Anwar Ibrahim said the government was reviewing the subsidy for RON95 fuel, or Budi95, which is currently also given to higher-income earners. This comes amid calls for the government to target only lower- and middle-income groups as fuel prices spike due to the Iran war.
While the view is that blanket subsidies should be removed for T20 income earners (combined household income of RM11,819), various factors complicate the true scenario for households that may fall in this category, such as number of dependents and cost of living pressures according to location.
Anwar said that while the government agrees in principle with removing subsidies for high-income earners but did not want the move to affect the upper-middle class.
Akmal today said the matter had been discussed at the National Economic Action Council.
The government needs to study implementation details, including the income eligibility threshold, before deciding on the income threshold, he said.
He did not state when implementation would begin.
Putrajaya’s subsidy bill for April is expected to be RM7 billion. It was RM700 million per month to February 28 when US-Israel forces began a war on Iran. – May 11, 2026