I read with concerns the statement by Economic Affairs Minister YB Dato Sri Mustapa Mohamed that the Government is working on a new targeted fuel subsidy mechanism for the lower income group.
No one will object to the proposal for the hardcore poor, the poor and the B40 to be covered under the targeted fuel subsidy. However, the middle class, the working class in the category of M40 should also be included in the fuel subsidy progamme. M40 or the Middle 40% forms the bulk of Malaysian population. M40 refers to the middle class earning the household income between RM4851 to RM10,970 per month and they are taxpayers.
Malaysia is an oil producing country and we should have leverage when International Brent Crude Oil price hitting high and Petronas will be reporting high revenue. The extra profits earned by Petronas should also be utilised to cushion the impact of the financial burden of the Government as the results of high subsidy bills.
Targeted fuel subsidy mechanism will have implementation challenges and there are inflationary pressure for all sectors of economic as transportation which use petrol as the main fuel constitutes 16 percent in the calculation of Consumer Price Index.