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2203) ARKIB BERITA PPIM – 28/10/2014 THE RAKYAT POST – Calls for Higher Luxury Car Tax, Rather Than Limit RON95 Subsidy
01 Nov 2014

The government should consider hiking the road tax for luxury cars instead of forcing those in the high-income bracket to pay market prices for RON95 petrol, said an academic.
Universiti Malaysia Sarawak lecturer at the Faculty of Business and Economics Prof Dr Shazali Abu Mansor said all consumers, regardless of what car they drive, should have access to subsidised petrol and should also be given the freedom to choose between RON95 or RON97 petrol.
“There may be low-income earners who want to use RON97 petrol and there may also be those in the high-income group who want to use RON95 – it all depends on the requirements of the car they drive.”
Deputy Finance Minister Datuk Ahmad Maslan had said the government is finalising a mechanism which will see those in the high-income bracket paying market price for RON95 petrol, beginning next June.

The subsidised price of RON95 is currently RM2.30. RON97, which is not subsidised by the government, retails at RM2.80 per litre.

Shazali urged the government to reconsider its decision to get high-income earners to pay the market price for RON95, pointing to the absence of a proper mechanism to compute the actual income of the car owners.
“The cost of living has gone up and people (in all income groups) are already tightening their belts. It’s not fair to burden them further.”
He suggested that the government raise the road tax for luxury vehicles to factor in the subsidy extended to RON95 petrol.
“What I’m saying is increase the road tax (for luxury cars) but let them (the owners) continue using subsidised RON95 petrol.”
Federation of Malaysian Consumers Association Vice President Siti Rahayu Zakaria voiced the association’s support for a petrol card which took into account a person’s income, the number of cars he or she owns and the engine capacity.
“Currently, however, there is no mechanism which determines the eligibility for RON95.
“I feel it’s the social responsibility of those in the high-income bracket to help fellow Malaysians in the medium- and low-income categories by choosing to buy non-subsidised petrol.”
Siti Rahayu added that the government should also note that people in all income categories have been exhibiting similar expenditure patterns as they have all been affected by the rising cost of living.
“We can find out how much people earn but how do we estimate their expenditure? For example, a person who earns RM5,000 a month and has one child and another person who earns RM10,000 but has five children have different levels of expenditure.
“Hence, if the government wants to come up with a card for people to buy the subsidised petrol, it should not only take household income into consideration but also total expenditure.”
Malaysian Muslim Consumers Association chief activist Datuk Nadzim Johan said he fully supports the government’s decision to only allow the low-income earners to buy subsidised petrol.
“It’s only fair that high-income earners pay the market price for RON95 petrol. Government subsidies should be targeted at the right groups.”
Urging consumers to be thrifty and spend moderately, he said instead of becoming uptight each time prices go up, they should think of ways to increase their household income.

Credit : http://www.therakyatpost.com/business/2014/10/28/calls-higher-luxury-car-tax-rather-cut-ron95-subsidy/