A Sarawak owner of a private diesel vehicle can now hand the vehicle's subsidised fuel entitlement to the person who actually drives it, including an employee or someone outside the family. The federal government lifted the family-only restriction on BUDI MADANI Diesel eligibility transfers on 16 September, and applications opened the same day.

Prime Minister Datuk Seri Anwar Ibrahim announced the change at the national-level Malaysia Day celebrations in Kuching, saying it took effect immediately. Until then a registered owner could pass BUDI Diesel eligibility only to an immediate family member who was the vehicle's actual user.

What the new rule allows

The Finance Ministry set out the conditions in a statement issued alongside the announcement. A registered owner may transfer monthly eligibility to any Malaysian citizen who holds a valid MyKad, is eligible for BUDI95 and is the actual user of the vehicle assigned to them. The transfer carries no change of vehicle ownership, and an approved recipient receives their own monthly entitlement to buy subsidised RON95, subsidised diesel, or a combination of both.

The limits are specific:

  • An owner of more than one private diesel vehicle may transfer monthly eligibility to a maximum of three other individuals, subject to how many diesel vehicles are registered to them.
  • Eligibility on any vehicle that is not transferred stays with the owner for their own use.
  • An owner who transfers all three of the diesel vehicles they own is left eligible for the BUDI95 petrol subsidy only.
  • For each eligible vehicle the transfer may be made only once, and once it is approved the eligibility cannot be moved back to the registered owner or on to a different person.
  • Transfers of monthly eligibility are subject to an appeal application.

The date that matters is the 27th

Applications can be made through the BUDI MADANI portal at www.budimadani.gov.my, in person at Inland Revenue Board offices, or with help from staff at petrol stations. Processing runs on a monthly cycle: an application submitted by the 27th of one month allows the eligibility to be used from the 1st of the next. The ministry's own worked example is an application lodged by 27 September, which would let the recipient buy subsidised fuel from 1 October, subject to data verification and validation.

Why the pressure came from Sarawak and Sabah

Anwar tied the change directly to complaints from the two Borneo states. He said the government had set a 300-litre monthly BUDI95 quota at the end of August, but that pickup and jeep owners, which he called "an issue prevalent in Sabah and Sarawak", continued to raise grievances, so the subsidised diesel limit was raised to 400 litres a month. Ministers from both states, he said, had pressed the concerns further.

The weighting of the scheme explains why. When BUDI Diesel began on 1 July, the Finance Ministry put the number of private diesel vehicle owners who would benefit at around 700,000 nationwide, of which 400,000 were in Peninsular Malaysia and 300,000 in Sabah, Sarawak and Labuan. A further 70,000 commercial and goods transport vehicles in the three territories qualified separately. Deputy Domestic Trade and Cost of Living Minister Datuk Dr Fuziah Salleh said the registration-based system was also meant to curb leakage at the borders, where subsidised diesel had previously been sold in bulk.

Two prices, two schemes

Sarawak drivers meet the subsidy through two separate mechanisms, and the rates are not the same.

  • BUDI Diesel covers private diesel vehicles at RM2.10 a litre, verified by MyKad at the pump.
  • SKDS, the Subsidised Diesel Control System for land freight, is priced at RM2.15 a litre and bought with a fleet card. Registration for Sabah, Sarawak and Labuan opened on 4 May, after Deputy Prime Minister Datuk Amar Fadillah Yusof announced the expansion on 6 April.

For scale, the ministry's price table for 12 to 18 March 2026 put unsubsidised diesel at RM3.92 a litre while holding subsidised RON95 at RM1.99 under BUDI95. Before the July standardisation, the subsidised diesel price for the public in Sabah and Sarawak was RM2.15.

What was removed, and what was added

The transfer rule is the latest of several adjustments. From 1 July the domestic trade ministry revoked its 27 March directive controlling diesel sales to land transport vehicles in Sabah, Sarawak and Labuan, withdrawing the 50, 100 and 150-litre purchase limits and putting MyKad verification in their place.

Alongside that, the government waived vehicle ownership transfer fees, which can reach RM100, for diesel vehicles for three months from 1 July, and the Road Transport Department opened weekend counters from 4 to 26 July so owners could bring registration records into line with actual use. The Cabinet also extended BUDI Diesel to company-owned private pickups and jeeps, which the ministry said would help people using them for small businesses, daily commuting and work in rural and interior areas.

Owners of eligible pickups and jeeps can separately apply for an additional 100 litres a month through the portal. Take-up was immediate: more than 18,000 applications for the extra quota had been lodged by 10pm on 28 June, the second day of early access.

Sources