KUCHING: The Sarawak government will stand firm on its imposition of the five per cent State Sales Tax (SST) on petroleum products even though oil prices are plummeting worldwide due to lack of demand.
Assistant Minister in the Chief Minister’s Department (Law, State-Federal Relations and Project Monitoring) Datuk Sharifah Hasidah Sayeed Aman Ghazali said it was understandable that the oil prices had dropped tremendously because of the global Covid-19 pandemic.
“Logically then, the quantum of our five per cent SST would be less or reduced. We have no issue with that as we understand the economic problems the whole world is facing.
“But we stand firm on our imposition of the sales tax, so less sales would mean less revenue but we will continue to impose our tax,” she said when asked whether the oil market prices would affect the SST.
Hasidah also reminded that the High Court had decided the state had a legal right to impose sales tax.
“This is our rights under the Federal Constitution and by virtue of the recommendations under the Inter-Governmental Committee Report (IGC Report) and the Malaysia Agreement 1963 (MA63),” she said.
She added that before SST was imposed, the then Pakatan Harapan (PH) government had promised 20 per cent oil royalty to Sarawak.
“We are aware that the federal government would not agree to give the 20 per cent royalty as have been mentioned and conveyed to us many times by the previous prime minister. We understand that,” she said.
She pointed out that the state under the leadership of Chief Minister Datuk Patinggi Abang Johari Tun Openg then proposed to impose the sales tax and it was unanimously agreed in the State Legislative Assembly (DUN).
“Therefore, we will continue to impose our State Sales Tax and that is non- negotiable,” she pointed out.
