Govt’s subsidy spending down 40% to RM23bil in 2025
Fuel subsidies were nearly halved last year while welfare grants and assistance increased by 380%.
The government slashed its subsidy spending by 40.1% in 2025, bringing the total to RM23.43 billion, according to the auditor-general's latest report. This marked a stark contrast to the RM39.10 billion spent on subsidies in 2024. The report attributed the significant decline in subsidy expenditure to a sharp drop in global crude oil prices and reforms aimed at curbing targeted diesel and petrol subsidies.
The RM15.67 billion reduction in subsidy spending was primarily driven by a dramatic decrease in petroleum product subsidies. In 2024, these subsidies amounted to RM34.91 billion, but by 2025, they had plummeted to RM19.11 billion. This drop was partly due to the average global crude oil price falling to US$69.05 per barrel in 2025 from US$80.81 per barrel in 2024.
In addition to the petroleum sector, other subsidy areas also experienced reductions. Petrol subsidy expenditure saw the steepest decline, falling 46.5% to RM10.51 billion in 2025 from RM19.66 billion in 2024. Diesel subsidy spending followed suit, dropping 48.2% to RM5.98 billion from RM11.54 billion in the same period. Liquefied petroleum gas (LPG) subsidy expenditure also decreased by 29.1% to RM2.63 billion from RM3.71 billion.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Govt’s subsidy spending down 40% to RM23bil in 2025 freemalaysiatoday.com
