AN allocation of RM2.2 billion has been set aside for the targeted fuel subsidy programme (PSP) which will benefit about eight million motorists.

Finance Minister Lim Guan Eng said beginning January, two categories of people on the peninsula would benefit from PSP, an election pledge of Pakatan Harapan.

“The first category comprising recipients of BSH (cost of living aid) will get a petrol subsidy of RM30 a month if they are car owners or RM12 a month if they own a motorcycle.

“This subsidy will be given in the form of cash transfers and will be credited into the recipient’s bank account every four months. The first payment will be made in April 2020 for the period January to April 2020,” he said when tabling Budget 2020 in the Dewan Rakyat here today.

He said the second category of eligible motorists who were not BSH recipients would receive the Kad95 which would enable them to enjoy a fuel subsidy of 30 sen per litre up to 100 litres per month for cars or up to 40 litres a month for motorcycles.

Lim said Kad95 would be introduced in stages in the first quarter of 2020.

“When this fuel subsidy is implemented, the retail price of RON95 and diesel will gradually be floated, and this will reduce leakages and cross-border smuggling of subsidised fuel which has cost the government losses amounting to millions of ringgit.

“The subsidy can be given if the retail price of RON95 set by the automatic price mechanism is more than RM2.08 per litre and no subsidy will be given if the price is below RM2.08 per litre,” he said.

Lim said luxury cars were not eligible for the subsidy.

He said eligible vehicles were cars with engine capacity not exceeding 1,600cc, cars with engine capacity of more than 1600cc which are more than 10 years old, and motorcycles with engine capacity not exceeding 150cc and motorcycles with engine capacity of more than 150cc which are more than seven years old.

“Every citizen who owns not more than two cars and two motorcycles are eligible for the PSP for one vehicle only,” he said.

He added that motorists in Sabah and Sarawak will continue to enjoy a ceiling price of subsidised petrol at RM2.08 for RON95 and RM2.18 for diesel.

“If the Sabah and Sarawak governments want to be part of PSP, the government will accept their request,” he said. – Bernama, October 11, 2019.