Licence to fill: Malaysia’s new fuel subsidy limited to national ID card holders

Malaysia has rolled out a targeted fuel subsidy scheme that limits each citizen to 300 litres of discounted petrol per month, replacing a decades-old blanket subsidy that had become a political flashpoint and a fiscal drain.

The new measure, launched on Tuesday, marks a significant policy shift by Prime Minister Anwar Ibrahim’s administration, which hopes it will curb rampant fuel smuggling to neighbouring countries, misuse by foreigners and excessive consumption by wealthy Malaysians with gas-guzzling cars – long-standing problems blamed for squandering taxpayer funds.

Under the previous blanket system, any vehicle arriving at a pump could access the subsidised price, regardless of the driver’s identity. That scheme cost nearly 20 billion ringgit (US$4.7 billion) annually, or about 8 per cent of total government spending. Much of that was used on petrol priced at just 2.05 ringgit (US$0.49) per litre.

The new scheme allows Malaysians to purchase subsidised petrol at 1.99 ringgit per litre, but only if they hold a valid national identity card, known as MyKad, and a current driving licence – a requirement designed to ensure that only genuine citizens benefit.

Across Kuala Lumpur, motorists swiped their ID cards at petrol pumps as attendants helped familiarise them with the new system.

  

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