What fiscal impact would MPV subsidy extension likely have?

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Extending the extra 100 litres of diesel subsidy to diesel-powered MPV owners would have only a minimal fiscal impact.

The Malaysian Automotive Association (MAA) said that extending the additional 100 litres of subsidised diesel to diesel-powered multi-purpose vehicle (MPV) owners would result in only “minimal fiscal impact.” MAA estimated that diesel-powered MPVs make up about 1% of the total industry volume (TIV), which it said keeps the cost effect small.
MAA’s estimate of MPVs within total industry volume
MAA said diesel-powered MPVs account for only about one per cent of the total industry volume (TIV). On that basis, it characterised the subsidy extension’s fiscal effect as limited.
The specific subsidy being discussed is an extra 100 litres
The proposal concerns extending an additional 100 litres of subsidised diesel beyond the existing allocation. MAA’s view on fiscal impact is tied to adding this extra volume for eligible diesel-powered MPV owners.
The current eligibility is limited to pick-up trucks and SUVs
MAA said the measure is currently available only to eligible pick-up truck and sport utility vehicle (SUV) owners. It argued that widening eligibility to MPV owners would still keep the fiscal impact minimal because of the small MPV share of TIV.
Why MAA still framed the extension as meaningful
Even while calling the fiscal impact minimal, MAA said the extension could provide meaningful assistance to families who depend on these vehicles. It also pointed to the broader context of consumer uncertainty after diesel subsidy rationalisation, with demand for diesel vehicles having declined after the diesel price was floated on June 10, 2024.

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What fiscal impact would MPV subsidy extension likely have?

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