KOTA KINABALU – The federal government expects to finalise an upwards revision of its current revenue sharing formula with Sabah soon, Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz told the Dewan Rakyat today.
Tengku Zafrul said the federal government is confident it can leverage on its strong cooperation with the state leadership to come to a consensus on the new rate as provided for under the federal constitution.
“Hence, in the near future this year, the federal government would be able to provide a higher special grant payment,” the minister told Parliament.
Sabah has been receiving a fixed annual payout of RM26.7 million from the federal government since 1973 as a share of revenue generated by the state, after both sides failed to come to a consensus on the percentage split during two reviews in 1969 and 1973.
Political leaders in Sabah have argued that the federal government had reneged on the 40% revenue share deal that they said was agreed upon under the Malaysia Agreement 1963.
Tengku Zafrul said the 40% rate is no longer applicable as it was deemed to be outside of the federal government’s financial capacity now, as it was in 1973.
He said a 40% revenue share payout to Sabah would force the federal government to spend more than it earns, which would go against constitutional provisions for prudent fiscal management.
However, Sabah routinely receives one of the highest annual developmental budgets and most recently in December, struck a commercial deal with national oil giant Petronas to develop its oil and gas industry, the minister said.
Last month, Minister in the Prime Minister’s Department (Sabah and Sarawak Affairs) Datuk Seri Maximus Ongkili said Sabah can expect to see a five-fold increase to its annual special grant from the federal government. – The Vibes, March 14, 2022
.jpeg)
.jpg)
.jpg)
