Kota Kinabalu: Sabah has collected RM7.36 billion up to March this year since the sales tax on petroleum products was introduced in 2020.
Sabah Finance Minister Datuk Seri Masidi Manjun said studies on the state’s sales tax on petroleum products began in 2012, but it was only implemented in 2020.
Since 2021, the state government has collected more than RM1.4 billion annually from the tax, with the highest collection of RM1.9 billion recorded in 2022.
“The scope of the tax on petroleum products, which was previously limited to crude petroleum oil, including condensate, and natural gas or liquefied natural gas, has since been expanded to include additional products, like ammonia and urea from Aug 1, 2022 and methanol from Oct 1, 2023.
“To further optimise the collection of petroleum product taxes, starting Feb 1, 2025, the state government has implemented a reference pricing mechanism using the average market price over the past 12 months.
“The tax will be calculated based on the higher of either the invoice price or the reference price,” he said during his winding-up speech at the State Legislative Assembly sitting.
On the petroleum royalty remaining at five per cent, Masidi said the state government had gained a larger share of revenue, participation and control in the state’s oil and gas sector.
He said this was possible through the Commercial Collaboration Agreement signed with Petronas on Dec 7, 2021.
“This is evident in the participation of SMJ Energy, a fully state-owned oil and gas company, in various upstream and downstream activities.
“With an initial capital of RM50 million, SMJ Energy has declared and distributed dividends totalling RM110 million to the state government in just two years and has now grown into a RM5 billion company.
“I wish to highlight the involvement of local companies in the oil and gas services and equipment sector, where total revenue from 2021 to 2024 has grown from RM613 million to RM2 billion, a 229 per cent increase.
“These are some of the direct benefits enjoyed by the state of Sabah from its own oil and gas industry, in addition to the five per cent royalty payments.”