KUALA LUMPUR – The Petrol Dealers’ Association of Malaysia (PDAM) is urging the government to provide clearer details on the mechanism for the targeted RON95 petrol subsidy, which is slated for implementation in September and will see Malaysians enjoy a subsidised rate of RM1.99 per litre.
Speaking to Scoop, PDAM president Datuk Khairul Annuar Abdul Aziz said there remains significant ambiguity surrounding how the targeted subsidy will be carried out.
“There are still grey areas in the implementation mechanism. We don’t know whether it will apply to everyone or only to eligible Malaysians,” he said.
“For example, previously, a person with a MyKad driving a Singapore-registered vehicle was not allowed to pump RON95 petrol. But the government has now said all Malaysians will receive the subsidy — so there’s confusion.”
He also cited cases involving foreign tourists residing in Malaysia who use locally registered vehicles.
“In the past, they could benefit from the subsidy because the vehicle had a Malaysian plate, but under the new system, as non-citizens, they would likely be excluded,” he said.
Khairul added that such inconsistencies raised questions about whether the existing enforcement mechanisms would be retained or replaced entirely.
Prime Minister Datuk Seri Anwar Ibrahim recently announced that the price of RON95 petrol would drop to RM1.99 per litre once the targeted subsidy system is implemented, benefiting around 18 million drivers and motorcyclists, including youth as young as 16 and gig workers.
Anwar, who also serves as Finance Minister, said further details of the targeted subsidy framework would be revealed by the end of September and reiterated that 85% of Malaysians would not be affected by the subsidy rationalisation.
PDAM, meanwhile, is awaiting feedback from the Ministry of Finance (MOF) for a meeting to discuss its concerns, especially given the tight timeline before the policy comes into effect.
“We were supposed to be part of the pilot discussions, but oil companies excluded us. They’ve been dealing directly with MOF without involving us,” Khairul said.
He added that PDAM hopes the subsidy distribution system will be automatic, fast and stable to avoid disrupting daily operations and inconveniencing consumers.
While expressing PDAM’s willingness to cooperate with the government to ensure a smooth rollout, Khairul voiced concern over the strain the new mechanism could place on petrol station operators’ cash flow — particularly smaller stations — as they would need to purchase RON95 at full market price before receiving government reimbursements.
“This puts immense pressure on cash flow, especially for small- and medium-sized stations. We hope MOF will agree to daily reimbursement of subsidies to prevent delays,” he said.
Khairul also raised concerns about rising operating costs, including the merchant discount rates (MDR) for electronic payments, which he said have surpassed the profit margins set by the government.
“This means station operators are making a loss on every e-wallet or card transaction,” he said. — July 30, 2025