Malaysia committed to 2025 petrol subsidy cut but no fixed date
[KUALA LUMPUR] Malaysia is committed to reducing petrol subsidies in the second half of the year and is refining its plan as US tariffs darken the economic outlook.
The government 'will continue to assess inputs and feedback in refining details' of its fuel subsidy revamp as it actively engages with a wide range of stakeholders, a spokesperson at the Ministry of Finance said.
Prime Minister Anwar Ibrahim in October said that the government would cut subsidies on the most popular petrol in mid-2025, a move that's expected to save the government RM8 billion (S$2.4 billion) a year.
Policymakers are planning a two-tier price system for RON95 petrol. Anwar said then that only the wealthiest 15 per cent would pay the market rate for it, while the rest will enjoy the current subsidised price.
'The government remains committed to implementing the RON95 subsidy rationalisation in the second half of 2025, and will be sharing further details in due course,' the spokesperson said.
Anwar, who is at the midpoint of his five-year term, faces a juggling act. Lawmakers have urged the government to postpone the move and other adjustments to fiscal policy that they fear would damp business confidence and increase costs for consumers.
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But cutting the subsidies are key to meeting government pledges to narrow the country's fiscal deficit. A reduction in diesel subsidies in June last year added to the government's coffers – and was followed by the ruling coalition's loss in a by-election.
To assuage Malaysians' concerns, Anwar – who is also finance minister – said in March that a government study showed the planned subsidy cut will not affect 80 to 90 per cent of the population.
A recent decline in global oil prices has made it easier for policymakers to push ahead with the politically sensitive move as disruptions in global trade from US President Donald Trump's tariffs dim the outlook for Malaysia's economy.
Officials are seeking to negotiate a deal with Washington within the 90-day pause on higher tariffs mandated by Trump, who has in the meantime imposed a 10 per cent levy on goods from Malaysia and many other trading partners.
Malaysia has already delayed a planned expansion of its sales and service tax that was due on May 1, providing a temporary reprieve for manufacturers. Still, electricity prices are scheduled to rise in July.
The government is confident of achieving its target to narrow the budget gap to 3.8 per cent of gross domestic product this year from 4.1 per cent in 2024, Malaysia Second Finance Minister Amir Hamzah Azizan said in April.
Policymakers are seeking to ensure that the implementation of the petrol subsidy cut is 'as smooth as possible for Malaysians and effective in meeting its objectives', the Ministry of Finance spokesperson said.
'The overarching objective remains clear – to ensure that most Malaysians continue to enjoy RON95 at subsidised price while addressing the leakage of subsidies to foreigners, businesses and the highest income earners,' the spokesperson said. BLOOMBERG
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CNA
5 hours ago
- CNA
1 minister's defection, 2 unhappy political parties: Trouble brewing in Malaysia's ruling coalition?
KUALA LUMPUR: The looming defection of a Malaysian minister from a key coalition partner of Prime Minister Anwar Ibrahim to his own party has put the premier in a bind, as he seeks to balance unhappiness from both sides, analysts said. They added that the expected move of Anwar's Parti Keadilan Rakyat (PKR) to admit Investment, Trade and Industry Minister Tengku Zafrul Abdul Aziz as a member has to be managed carefully or it could undermine the ruling coalition. Tengku Zafrul had announced on May 30 that he had resigned from the United Malays National Organisation (UMNO) to join PKR. The minister is seen as someone who has roped in significant sums of investment for Malaysia and raised the country's profile on the international stage, a key priority of the Anwar administration. Fearful of losing Tengku Zafrul's critical contributions as a minister in a key portfolio, Anwar must now shoehorn him into a politically viable position in PKR, the analysts told CNA, even as such a move was criticised by several UMNO leaders including its president Ahmad Zahid Hamidi. Ahmad Zahid, who is also Deputy Prime Minister, said on Jun 2 it was "unethical" for parties within the unity government to accept a member from an ally. The grumblings extended to Anwar's own PKR, with party members questioning the timing of Tengku Zafrul's announcement, party insiders told CNA on the condition of anonymity. Tengku Zafrul's statement came two days after the high-profile resignations of two PKR ministers, Economy Minister Rafizi Ramli and Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad, following their defeat in internal leadership polls. PKR members fear the admission of Tengku Zafrul could sideline the party's rank and file for top positions both within and outside in the state or federal governments, and erode the trust other unity government partners have in PKR, the well-placed party insiders said. On UMNO's part, Ahmad Zahid said he hopes his party will be given a ministerial post following Tengku Zafrul's departure, to ensure UMNO's "quota" of seven ministers remains intact. While it "should not be a problem" for Anwar to meet UMNO's demands, the larger issue is whether PKR should even accept Tengku Zafrul as a member in the first place, said political analyst Sivamurugan Pandian of University Sains Malaysia (USM). "The bigger question is whether this should be a precedent or practice. If it happens now, what happens if someone from PKR moves to UMNO?" he told CNA. "I think they should draw the line from now onwards, if they want to strengthen the unity government and move as a grand coalition for the next election (due by February 2028)." PKR SET TO ADMIT TENGKU ZAFRUL PKR would eventually accept Tengku Zafrul as Anwar saw him as someone who had secured hundreds of billions of ringgit in investment for Malaysia, said Ahmad Fauzi Abdul Hamid, a political science professor at USM. Anwar therefore does not want Tengku Zafrul to be thrown into the "political wilderness", given the latter's weak grassroots support in UMNO and the looming end of his term as senator in December, Ahmad Fauzi told CNA. A minister must be an elected member of parliament (MP) in the lower house or an appointed senator in the upper house. Tengku Zafrul is nearing the end of his term as the latter as a senator can serve a maximum of two terms. While Tengku Zafrul was UMNO's Kota Raja division chief and a supreme council member, analysts believe he is unpopular with party members on the ground. 'If Zafrul were to continue in his portfolio as investment, trade and industry minister beyond December, he would first need to contest and win a by-election,' Ahmad Fauzi said. "So, it's not surprising that Anwar wants to retain him, at least in the upper echelons of Malaysian politics. If it's at the federal level, a PKR MP will probably have to resign.' Sivamurugan, however, said PKR should not think of deliberately vacating a seat, as this would take away the mandate given to that MP and infuriate constituents who might experience election "fatigue". "With Zafrul's experience and also how he has positioned himself, it is better if the Prime Minister can park him in his office as an economic advisor on international trade with the status of a minister," he said. "That I think will ease the tension between both parties at this point, rather than going for another by-election.' WHAT DOES UMNO WANT? If Tengku Zafrul stays on in his current ministerial portfolio, USM's Ahmad Fauzi feels UMNO could be given the vacant economy minister role, noting that UMNO's Johari Abdul Ghani has been touted as a possible candidate. The current plantation and commodities minister has brushed off concerns that Tengku Zafrul's resignation from his party would affect ties between UMNO and PKR in the unity government. Analysts said Anwar would want to preserve a harmonious relationship between component parties in the ruling pact. "He will also want UMNO votes later in the 16th general election, for UMNO voters to vote for PH as well, if the union lasts," Ahmad Fauzi said, referring to the Pakatan Harapan (PH) ruling coalition comprising PKR and other parties. "If PH and BN (Barisan Nasional coalition led by UMNO) go on to contest the election as one coalition, he will fear that any grudge on the part of UMNO will end up in UMNO voters shying away from voting for PH, and that might damage PH,' he added. 'It might even deliver votes to PN, and they could win by default.' The unity government comprises PH, BN, as well as other East Malaysian coalitions. In opposition is the Perikatan Nasional (PN) coalition, comprising Parti Pribumi Bersatu Malaysia (Bersatu) and Islamist party Parti Islam Se-Malaysia (PAS) among others. But geostrategist Azmi Hassan from the Nusantara Academy said UMNO is not interested in the economy or environment portfolios, because these come under PKR's allocation. "What UMNO wants is the international trade portfolio. So I guess that's what makes a lot of people in UMNO unsatisfied with this particular move,' he told CNA. 'Because of the minister post, not because of the move of Tengku Zafrul as an individual member.' INTERNAL GRUMBLINGS IN PKR A PKR insider said UMNO had "every right" to question if Tengku Zafrul's ministerial portfolio will be handed back, noting that the defection touched on the "very sensitive" issue of UMNO's ministerial allocation. "That raises a bit more questions on the timing of the matter again, like we are going into Sabah state polls, with all these questions being raised,' he said. 'And looking at public feedback on the party itself, it hasn't been very positive over the past few weeks. So the question needs to be raised on why these moves are being organised now.' Analysts previously told CNA that Rafizi's defeat in his bid to be re-elected as PKR deputy president could heighten divisions between party factions. Rafizi has since resigned, citing the lack of an internal mandate, while his reported ally Nik Nazmi followed suit after failing to defend his post as PKR vice-president. The election of Nurul Izzah as the party's second-in-command also triggered public accusations of nepotism, claims she has consistently rejected as she has insisted her positions were earned on her own merits through elections. "We are already losing two ministers, very highly competent ministers, and now we're making more political moves which are not being well received,' the PKR insider said, noting that all the indications so far show Tengku Zafrul's application will not be rejected. 'The party members are for sure going to be a bit more disgruntled afterwards.' Another PKR grassroots leader told CNA that the party leadership needs to exercise 'extreme caution' regarding Tengku Zafrul's admission. 'Even though there are no hard rules on this matter, the party must be careful about accepting members from unity government members,' he said, calling for Tengku Zafrul to be thoroughly 'screened'. 'It's a sensitive balance within Madani component parties. Bringing in high-profile individuals with UMNO or opposition-linked backgrounds directly into PKR will only deepen unease among the base.' PKR secretary-general Fuziah Salleh said on May 31 that the party will consider input from grassroots members and unity government partners when evaluating any membership application, although she noted then that the party had not received any official application from Tengku Zafrul. The other PKR insider said Tengku Zafrul's move and the impending end to his senatorial tenure had created a "messy situation" in the party, repeating that the timing was "questionable". "It raises the question of, 'Why now?' Is it on the back of what's going on with the party election and so on? And is there a move now to kind of divert the attention away from whatever happened?" he asked. Sivamurugan from USM agreed that the timing of the move could be perceived as trying to divert the attention from the resignations of Rafizi and Nik Nazmi, saying that not everyone in PKR would welcome Tengku Zafrul. "Because they know, once he's there, it's a threat to them as well, because he's accepted well by Anwar, the president,' he said. 'He has easy access to Anwar, the opportunities are more open for him. So of course, this will affect those who have been working very hard within the party till now. PH-BN partnership for GE16 not a given Ultimately, analysts believe Anwar and Ahmad Zahid share a special, mentor-mentee relationship that will allow them to resolve the issue amicably. Tengku Zafrul's move will not have an impact on the PH-BN partnership at the Sabah state election that is due by December, as the issues there are much more localised, the observers said. Azmi from the Nusantara Academy said Tengku Zafrul's current portfolio should be returned to UMNO once his term as senator ends in December. 'I think if that happens, then all will be okay with the PH and BN partnership," he told CNA. "Preferably it should be done before the upcoming Sabah state election, and more so I think before GE16." But this does not mean PH and BN will definitely work together at GE16, USM's Ahmad Fauzi said, adding that Anwar will ultimately decide to partner a party that can get him the Malay vote. "Looking at what has happened in PKR in the recent weeks, public trust in PKR as a reformist party has very much plunged,' he said, noting that Anwar will have to convince fence-sitters who only voted for PH because they hated the UMNO government or corruption. If by the time GE16 is due and Anwar does not enjoy Malay support, he could try to entice the Islamist opposition party PAS to team up, Ahmad Fauzi added. 'There are rumours that there have been behind-the-scenes negotiations (between Anwar and PAS) and so on. But we don't know how that will materialise in the real world.' CAN TENGKU ZAFRUL SUCCEED ANWAR IN PKR? In the longer term, Ahmad Fauzi did not rule out Tengku Zafrul succeeding Anwar as PKR's leader, noting that the minister is still considered relatively young in Malaysian politics at 51 years old. "Give him time. If he really asserts his role and plays well with the PKR political grassroots, that's not impossible, but he has to really work hard from now to, say, 10 years," he said. Sivamurugan said it is too early to tell as Tengku Zafrul has his work cut out for him. "He has to be a member, then hold positions at the division level first. That may take another five or 10 years, and we know at this point after the (PKR internal) election, Izzah is seen as the successor, and Anwar will not be able to contest (the PKR presidency) anymore," he said. "There are other young leaders also eyeing the top position as well, and we may see Rafizi coming back again within three or four years.' The fact that Tengku Zafrul contested and lost in the Kuala Selangor seat at the last general election in 2022 shows he does not have strong grassroots support, Sivamurugan said. "Maybe if he wants to be very active in politics after this, he should focus on how to climb up the ladder within PKR, if he believes that the acceptance level is different from UMNO." Asrul Hadi Abdullah Sani, a partner at strategic advisory firm ADA Southeast Asia, cautioned that Tengku Zafrul could end up like Zaid Ibrahim, a former law minister under UMNO in 2008 who left the party for PKR a year later. Zaid contested the Hulu Selangor by-election in 2010, but lost to a BN candidate. He quit PKR later that year after pulling out of a race for the party's deputy president post, citing "various issues of manipulation and unfair electoral practices". "Zafrul will need to prove himself to the party members by winning a state or federal seat before he is even considered a potential candidate to succeed Anwar as party president," Asrul Hadi said.
Independent Singapore
6 hours ago
- Independent Singapore
Immunity split: Why Anwar faces trial while Trump is shielded
The United States is classified as 'free' and Malaysia as 'partly free' in Freedom House's Freedom in the World 2024 report. However, US President Donald Trump enjoys more unbridled power than Malaysian Prime Minister Anwar Ibrahim. Mr Anwar's plea for immunity while in office has been rejected by the Malaysian High Court. He is accused of sexual assault by his former research assistant Muhammed Yusoff Rawther in 2018, four years before he became prime minister. Trial is due to start on June 16. The High Court dismissed Mr Anwar's application to refer eight constitutional questions to the Federal Court. High Court Judge Roz Mawar Rozain said the federal constitution does not provide immunity for prime ministers. She also ordered Mr Anwar to pay RM20,000 in costs to Mr Yusoff. Mr Anwar's lawyer, Alan Wong, said they would appeal the court's decision. Mr Anwar wanted the Federal Court to determine whether allowing the lawsuit to proceed would impair his ability to effectively discharge his executive duties, according to Wong. Mr Anwar said in a statement: 'This matter has never been about seeking personal immunity or escaping legal scrutiny. It concerns the integrity of our constitutional system and the need to ensure that high public office is protected from litigation that may be strategically timed, politically motivated, or institutionally disruptive.' See also Americans brace for Covid 'surge upon a surge' Malaysian High Court vs US Supreme Court The Malaysian High Court's ruling on the prime minister contrasts with the US Supreme Court's stance on the president. The US Supreme Court has granted President Donald Trump significant immunity from criminal prosecution for actions taken during his presidency. In the landmark 2024 decision Trump v. United States, the court ruled that a president is entitled to absolute immunity for actions within their core constitutional duties and at least presumptive immunity for other official acts. However, there is no immunity for unofficial or personal conduct. This ruling carried weight in legal proceedings against Mr Trump, particularly those related to his efforts to overturn the 2020 election. While some charges have been affected by this decision, others, such as his conviction in New York for falsifying business records related to hush money payments, have been upheld. The court determined that these actions were personal and not protected by presidential immunity. Prosecuted leaders While former leaders being prosecuted is relatively common in democracies, it is rare for a sitting leader to face criminal prosecution or conviction while still in office. Former heads of state or government charged with crimes include: Former French presidents Jacques Chirac and Nicolas Sarkozy. Both were convicted of corruption after leaving office. Former Israeli prime minister Ehud Olmert. He was convicted of corruption after leaving office. Former South Korean presidents Lee Myung-bak and Park Geun-hye, have been convicted and imprisoned after their term. Former Malaysian prime minister Najib Razak is currently serving a prison sentence for corruption. Another Malaysian premier, Muhyiddin Yassin, was charged with abuse of power and money laundering after leaving office. Former Argentine President Cristina Fernández de Kirchner was convicted of fraud after her term, though she continued to serve as Vice President while appealing. Sitting leaders being prosecuted are rare but not unheard of. Israeli Prime Minister Benjamin Netanyahu is currently on trial for corruption charges. Former Austrian Chancellor Sebastian Kurz was criminally investigated on corruption charges while in office. He resigned and was later convicted of perjury. Mr Anwar, 77, has faced legal battles and jail sentences in the past for what he calls politically motivated cases. His former aide, Yusoff, 31, currently detained by the police, is on trial for alleged drug trafficking . He claims he was framed by those in power. His lawyer, Muhammad Rafique Rashid Ali, welcomed the High Court ruling. He said it shows there is equality for everyone. Mr Anwar's plea for immunity was opposed by the civil society group, Lawyers for Liberty. 'This is not a concept that exists in any democratic country; it is a blatant violation of the rule of law and a flagrant feature of authoritarianism,' said Lawyers for Liberty director Zaid Malek, reported Bloomberg. See also Trump urged to embrace free trade amid rising tensions Awkward complications Prosecuting leaders in office, however, can create awkward problems and may undermine their ability to carry out their duties. That is why there have been cases when ministers and officials have been suspended or asked to take leave while under investigation. Singapore's former transport minister S. Iswaran was instructed by the then prime minister Lee Hsien Loong to take a long leave of absence while being investigated for accepting valuable items from billionaire Ong Beng Seng. He was sentenced to 12 months' jail in October 2024, but after four months in prison, he was put on home detention for the rest of his term. Also noteworthy was the 'hush money' case against Mr Trump. He was convicted by a New York jury of falsifying business records after his former personal lawyer, Michael Cohen, allegedly paid adult film actress Stormy Daniels $130,000 just before the 2016 election. However, the presiding judge, Juan Merchan, let hin off with an unconditional discharge on January 10. Ten days later, on January 20, Mr Trump was sworn in as president. Featured photo from Facebook (for illustration purposes only)
Straits Times
8 hours ago
- Straits Times
More than $8.5b GST collected by Singapore Customs in 2024; increase in tobacco and liquor offences
This is the highest amount of GST collected by the agency to date, based on statistics from the open government data portal PHOTO: ST FILE More than $8.5b GST collected by Singapore Customs in 2024; increase in tobacco and liquor offences SINGAPORE - Singapore Customs collected more than $8.5 billion in goods and services tax (GST) in 2024, an increase of more than $1 billion from the year before. This is the highest amount of GST collected by the agency to date, based on statistics from the open government data portal which tracked the figure from 2013 onwards. That year , Singapore Customs collected $5.5 billion in GST. A decade on, when the GST rate increased in 2023, it collected $7.3 billion. Of the amount collected from GST , almost all of it was on imported goods, with less than one per cent on locally manufactured goods subjected to excise duty. GST rates increased from 7 per cent to 8 per cent in 2023, and to 9 per cent in 2024. Singapore collected a total of $20.6 billion in GST in 2024, with the Ministry of Finance saying this was due to stronger-than-expected growth in private consumption. The Government has said the revenue from the increase will go towards meeting Singapore's medium-term needs, such as in healthcare and social spending. Prime Minister Lawrence Wong, who is also the Finance Minister, said there will be no need for further increases in GST up to 2023. The amounts collected by Singapore Customs were revealed in its annual report that was released on June 5. Aside from GST, it also collected $1.1 billion in duties for tobacco and $775.9 million in duties for liquor in 2024. On the enforcement front, it reported significant increases in cases involving tobacco and liquor offences. Tobacco cases jumped by almost 40 per cent to 20,131 in 2024, from the 14,510 in 2023. Liquor cases increased by more than 80 per cent with 3,384 cases in 2024, as compared to 1,848 cases in 2023. Cases involving GST offences saw a slight increase, from 4,664 in 2023 to 5,447 in 2024. Over the past year, several cases of tax and duties evasion have made the headlines, including one involving a woman who shared online tips on how to avoid paying GST on luxury goods. The 27-year-old went on a trip to Europe with her family and boyfriend in May 2024, where she bought luxury goods such as bags and wallets and received an engagement ring purchased there. But she did not declare these items upon returning to Singapore. She posted about her overseas purchases and gave tips on evading customs checks on her social media account. Netizens reported the post to the authorities. She was arrested in January and fined $18,000 in March. Most recently, it was reported that almost 200 travellers were caught between May 21 and May 27 for a series of similar offences, including not declaring large cash amounts and evading taxes on tobacco. Mr Tan Hung Hooi, Director-General of Singapore Customs, said that in 2024, its frontline officers disrupted complex tax evasion schemes and uncovered sophisticated smuggling operations. He noted how over 200 customs officers were recognised for their exemplary service or excellent work in 2024, with 11 of them receiving international honours from the World Customs Organisation. 'Our mission remains clear: to protect Singapore's revenue and enable trade that is secure, fair, and future-ready,' he said. 'These stories reflect more than tactical success; they are reminders that every seizure safeguards public revenue, protects legitimate businesses, and preserves trust in Singapore's trade integrity.' He added that the agency is working to strengthen its use of automation of data and artificial intelligence. Under the Customs Act, those convicted of evading duties can be fined up to 20 times the amount of duty and GST evaded, or jailed for up to two years. Join ST's WhatsApp Channel and get the latest news and must-reads.
