Government to Restrict Subsidised Pertalite Purchases for High-Income Groups

The Indonesian government is moving forward with plans to restrict the purchase of subsidised Pertalite fuel for high-income groups. The restriction will specifically target individuals in the top economic brackets, namely deciles 9 and 10.

Finance Minister Purbaya Yudhi Sadewa stated that the restriction will not be implemented immediately but is expected to take effect within the next few months. “We are discussing the possibility of implementing restrictions on Pertalite subsidies for the upper levels. Perhaps those in deciles 9 and 10, so that later, not now, in a few months we can gradually reduce it,” Purbaya said at the Ministry of Finance office in Jakarta on Tuesday.

Purbaya added that the restriction is being considered as the system is already in place. He noted that the restriction will not apply to motorcycle users. “So, motorcycles are not restricted. There is no change for motorcycles,” he said.

Energy and Mineral Resources Minister Bahlil Lahadalia highlighted that fuel subsidies have not been well-targeted, with wealthy groups still enjoying subsidised fuel. “Some subsidies are not on target. Why should we subsidise the rich? For example, Pertalite is still received by deciles 9 and 10. This is what we are starting to discuss, the system and everything,” he explained.

When asked about the restriction scheme, Bahlil said the government is still studying the mechanism. However, he stressed that subsidised fuel must be properly targeted. “The restriction will involve the type of vehicle. You shouldn’t be driving a BMW or a Mercedes and still using subsidised fuel, that’s what the Minister meant,” he added.