Malaysia to review diesel quota rates for commercial vehicles by August

PUTRAJAYA, June 27 — The government will review the fixed quota rates of subsidised diesel for several types of land transport vehicles for goods under the Subsidised Diesel Control System (SKDS) to ensure that the subsidy distribution is more accurate and in line with actual operational needs.

Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali said the decision was made following yesterday’s Cabinet Meeting which discussed the status of progress in implementing targeted fuel subsidy through the BUDI Diesel, BUDI95, Subsidised Diesel Control System (SKDS) and Subsidised Petrol Control System (SKPS) mechanisms.

“Prime Minister Datuk Seri Anwar Ibrahim has ordered improvements to be implemented in several aspects to ensure that the people’s feedback is met through strategies and approaches that take into account the people’s cost of living factors, leakage risk management and the country’s position and fiscal space,” he said in a press conference after a field session in conjunction with the implementation of the BUDI Diesel early access, here today.

Armizan said under the improvements, which are expected to be implemented by August, the adjustment of diesel quotas under SKDS will no longer be based solely on average consumption by vehicle type, but will also take into account several technical factors.

Among the factors that will be assessed are the weight with load (BDM), engine capacity, lorry category, fuel consumption levels and the operating pattern of each vehicle.

“There are vehicles of the same type of transport but different BDMs, so if previously there was a uniform fixed quota for the type of transport, which was the same, whereas in terms of usage we know that transport vehicles with larger BDMs in terms of weight, size and also the size of the load, then the fuel consumption would definitely be more.

“So yesterday the Cabinet decided to make an adjustment to the fixed quota not only by looking at the average previous usage, we have the previous usage record, but also by looking at other technical factors so that the quota is more in line with the operating costs of companies involved in the transportation of consumer goods,” he said.

He said the Ministry of Domestic Trade and Cost of Living (KPDN), the Ministry of Transport (MOT) and the Ministry of Finance (MOF) had been instructed to take immediate follow-up action to implement the Cabinet’s policy decisions by identifying appropriate channeling mechanisms including the need for modifications and integration into the existing implementation system.

“God willing, KPDN, MOT and MOF will work closely so that the policy decisions made by the Cabinet yesterday are implemented immediately so that more people would benefit from the targeted fuel subsidy agenda,” he said.

In addition, Armizan said the Cabinet also agreed to expand the distribution of diesel subsidies to small traders who have diesel vehicles such as jeeps and pickups registered in the name of a business or company under the class or code of private business use.

He said previously, the eligibility conditions for diesel subsidies were limited to vehicles registered in the name of individuals for BUDI Diesel and business vehicles or goods transport companies under the class or code of use for consumer goods transport for SKDS.

“Yesterday the Cabinet decided to expand this policy because it saw that these were small businesses that we needed to support,” he said.

Meanwhile, Armizan said owners of private diesel vehicles such as jeeps and pickups who were eligible under BUDI Diesel and wanted to apply for an additional 100-litre quota, bringing the total quota to 300 litres compared to the basic quota of 200 litres, could apply online or fill out a physical form.

“There are still those who think that the quota for BUDI diesel is only 200 litres, which is actually not correct, the basic quota is 200 litres for all those who have diesel vehicles registered in the name of individuals, but those who have diesel vehicles such as jeeps and pickups can apply for an additional 100 litres, so it is actually 300 litres.

“Actually, the way to apply is easy, it is on the official BUDI MADANI portal at www.budimadani.gov.my. Anyone who wants to apply physically, can go to the nearest Inland Revenue Board (LHDN) office, there will be an LHDN officer there who will assist,” he said, adding that LHDN offices in Sabah and Sarawak will be open tomorrow for the purpose of applying for additional BUDI Diesel quotas.

Commenting on the results of a field trip session at a petrol station here following the implementation of the early access BUDI Diesel for private diesel vehicles in Peninsular Malaysia, Armizan said he was satisfied with the level of readiness of the stations involved.

During the early access period, eligible consumers can buy subsidised diesel at RM2.15 per litre through MyKad verification at participating petrol stations.

“The survey covered the level of implementation preparation at the retail level of petrol stations including the stability of the transaction system, the verification process using MyKad and the oil company’s digital application, training for staff as well as aspects of customer-friendly services to ensure the smooth operation of the mechanism once it comes into effect,” he said.

He said that as a result of close collaboration between the government and the industry, 10 oil companies, namely PETRONAS, Shell, Petron, Caltex, BHPetrol, Five, Smart Stream, Xcel, PETROS and IPTB, had confirmed their respective readiness for the implementation of BUDI Diesel.

A total of 4,146 petrol stations nationwide were ready for the full implementation of BUDI Diesel as one of the fuel subsidy targeting mechanisms.

Through BUDI Diesel, eligible Malaysians will enjoy subsidised diesel at RM2.10 per litre at petrol stations either through MyKad verification or the company’s digital application. — Bernama