Economist backs govt's LPG rule enforcement to optimise subsidies

Free Malaysia Today

03-06-2025

All restaurants, cafés and hawker stalls are required by law to use commercial-grade 14kg LPG cylinders, which cost RM70 each. (AP pic)
PETALING JAYA : An economist has expressed support for the government's decision to enforce existing cooking gas cylinder regulations, saying it is necessary to prevent the misuse of subsidised liquefied petroleum gas (LPG) and ensure they reach their intended beneficiaries.
Sunway University's Yeah Kim Leng said the move would allow Putrajaya to reduce the RM3.4 billion it spends on LPG subsidies annually, allowing the savings to be reallocated to development programmes.
'The subsidy amount is sizeable and better used for health, education and other welfare development programmes. This should be communicated well, in line with the country's subsidy rationalisation reforms,' he told FMT.
Yeah, however, said traders, especially small vendors and hawkers, should be allowed a grace period to help them adjust to the changes.
Yeah Kim Leng.
'Rather than forceful enforcement, a more friendly and compassionate approach—such as warnings for first-time offenders and closer monitoring—would be desirable and less disruptive to small traders and hawkers,' he said.
Last month, the domestic trade and cost of living ministry launched Ops Gasak in an effort to curb the misuse of subsidised LPG, particularly by industrial users and large-scale businesses.
Businesses—including restaurants and cafés—are required to use commercial-grade 14kg LPG cylinders, costing RM70 each, and not subsidised household cylinders priced at RM26.
Those that use or store more than 42kg, or three cylinders, must also obtain a scheduled controlled goods permit.
Although introduced in 2021, the rule is only now being strictly enforced with the ultimate goal of reducing subsidy leakages.
Domestic trade and cost of living minister Armizan Mohd Ali said the initiative aims to curb the misuse of subsidised LPG by ineligible sectors and prevent the illegal transfer of gas from subsidised cylinders to non-subsidised ones for resale at a profit.
He also said enforcement officers were presently prioritising advocacy over punitive measures, and that no compounds will be issued or seizures conducted at this stage.
Yeah said many traders may not even be aware of the regulations in question, and suggested that the government set a grace period before fully enforcing the law.
He said small businesses, especially hawkers, may not be familiar with the law.
'Given that many small traders and hawkers are updated through word of mouth, a grace period coupled with well-crafted public communication and education programmes would be helpful in reducing misuse of subsidised gas.'