New mechanism puts inflationary pressure on rich and poor alike

Dateline 2014-06-03, Sin Chew Daily:

Once the government has put into implementation the “eligibility for subsidized fuel purchase” mechanism, those in the low and medium income bracket are not expected to be severely affected, but it is inevitable that the public will have to confront the inflation problem thanks to rising fuel cost.

The Petroleum Dealers Association of Malaysia (PDAM) hopes the new mechanism will make things convenient for vehicle owners while not excessively increasing the burden of petroleum dealers in the country.The association believes the prices of RON95 and diesel will inevitably be increased progressively.

According to the SMI Association of Malaysia once the government has specified that only those earning RM5,000 and below will be entitled to purchase subsidized fuel, small businesses will be affected.

Some believe the public will better accept the government’s plan if the subsidies saved could be used to improve on existing transportation facilities and development.of new infrastructure.

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