Record revenues spark dispute over Sabah’s financial legacy

SABAH has hailed record revenues and rising reserves as proof of its success post Covid-19.

But politicians from both sides of the camp are claiming credit for the financial windfall, each insisting it was their efforts that brought the state to this point.

At the heart of the argument is how much credit belongs to Chief Minister Hajiji Noor’s administration and how much to his predecessor, Warisan president Datuk Seri Mohd Shafie Apdal.

GRS information chief Datuk Joniston Bangkuai told villagers in Kiulu that the state under Hajiji had posted the highest revenue in history, with RM6.9 billion collected in 2022 and reserves climbing to RM8.7 billion.

He also pointed to record constituency allocations of RM4 million per assemblyman, new housing schemes under the Sabah Maju Jaya plan, and landmark deals such as a RM600 million federal grant and the Commercial Collaboration Agreement with Petronas.

“These milestones show that GRS is truly a government that delivers real and measurable results,” Joniston said, crediting political stability and “smart financial management” for the state’s performance.

However, Warisan dismissed the claims as “cheap propaganda,” saying the revenue surge was in fact the result of Shafie’s decision in April 2020 to impose a state sales tax on petroleum products.

Warisan supreme council member Mudi Dubing argued that Hajiji’s government had merely inherited the gains while failing to tackle long-standing problems such as water shortages, damaged roads and frequent floods.

He also claimed constituency allocations and housing figures were too small to be considered achievements and accused GRS of not fighting strongly enough to secure Sabah’s constitutional right to 40% of federal revenue.

Official data shows that state revenue rose sharply after the petroleum sales tax was introduced. In 2020, Sabah collected RM3.59 billion, including RM178 million from petroleum sales tax in its first partial year.

Revenue then climbed to RM5.45 billion in 2021, with petroleum sales tax contributing RM1.47 billion, more than a quarter of the total.

The Petroleum Sales Tax was introduced during Shafie's administration on April 1, 2020.

In 2022, revenues reached RM6.96 billion, with petroleum tax collections peaking at about RM1.9 billion.

In 2023, Sabah’s revenue stood at RM6.97 billion, with annual petroleum sales tax remaining above RM1.4 billion.

The tax has since become the state’s single largest revenue source, consistently contributing more than 20 per cent of annual income.

Still, GRS has moved to expand its coverage to include ammonia, urea and methanol, and from February 2025 a new pricing mechanism will ensure collections are assessed against market averages rather than company invoicing alone.

The revenues from these new sources have yet to make it into the books.

Despite the financial growth, critics say the benefits have yet to reach ordinary Sabahans.

Residents still endure regular water cuts, neglected rural roads and under-equipped hospitals.

Warisan argues record reserves mean little if they are not channelled into improving daily life, while GRS maintains that strong reserves and steady management are essential for long-term development.

“The RM6.9 billion figure is nothing but political cosmetics — people cannot eat numbers or drink reserves,” said Dubing. - August 27, 2025

Mudi and Bangkuai claim Sabah’s achievements were due to their strategies and hard work – August 27, 2025