KUALA LUMPUR: The BUDI95 programme is projected to generate savings that will be directed towards strengthening targeted social assistance such as the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA), ensuring fiscal resources are channelled more effectively to the vulnerable group, according to the Ministry of Finance (MoF).
Under the BUDI95 programme, Malaysian citizens with a valid driving licence are entitled to purchase RON95 at a subsidised price of RM1.99 per litre, while non-citizens will pay the non-subsidised price.
The MoF, in its Fiscal Outlook and Federal Government Revenue Estimates 2026 report released today, said besides the BUDI95 programme, the diesel subsidy rationalisation programme and BUDI MADANI initiatives have generated positive outcomes, including reduced leakages, increased resource efficiency and fiscal savings.
“By transitioning from a universal subsidy to a targeted framework, the government has addressed long-standing economic distortions while safeguarding the welfare of the rakyat through the BUDI MADANI and BUDI95 programmes,“ it said.
The MoF also said the targeted subsidy programme launched by the government has generated savings exceeding RM7 billion over the year, since its implementation in June 2024, compared to the initial annual savings estimated projection of RM4 billion.
It said the transition to the initiative has yielded significant financial benefits for the government by easing fiscal pressure and creating space for priority development expenditure.
“With well-designed policy, a systematic approach, and effective communication, the government can smoothly implement the subsidy rationalisation programme towards strengthening fiscal health and sustaining social protection,“ it said. – Bernama
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