THE Finance Ministry (MOF) said that the government does not intend to implement a carbon tax in the near future.

However, the ministry said there may be a need for it in the long term and will study its feasibility as one of the ways to support the nation’s goal of reducing greenhouse gas emissions by 45% based on the GDP in 2030, as targeted in the 12th Malaysia Plan.

The MOF said such a study will need to be comprehensive in order to gauge the impact of such a tax on industry and consumers.

“The study will need to refer to best practices in the countries that have implemented the carbon tax,” the ministry said on the parliament website in response to queries from members of parliament.

According to MOF, the carbon tax mechanism will need to be guided by the carbon mitigation policy of the Natural Resources, Environment and Climate Change Ministry and be in line with the National Low Carbon Aspiration 2040 plan as targeted under the National Energy Policy.

Apart from that, the MOF said the formulation of the carbon tax will need to be aligned with fuel subsidies so that the objectives of the two policies do not contradict each other.

“The government will focus on the need to develop the country in a green, sustainable manner that prioritises low carbon development, sustainability, and preservation of the environment,” it said. – Bernama, February 16, 2023.