KOTA KINABALU – The Sabah government will impose a 10% sales tax on scrap metals exported out of the state, replacing the RM200 per metric ton levy that came into force in February last year.
Sabah’s Industrial Development and Entrepreneur Minister Phoon Jin Zhe said the new regime was a cabinet decision in revising the state sales tax.
The levy was introduced in 2022 to replace the ban imposed by the state government on metal exports imposed temporarily by the state to deal with a shortage of scrap iron for steel billet and rebar production.
“The implementation of the (earlier) policy was met with opposition from the scrap metal dealers in the state, especially from Sabah Scrap Metals Recycle Association. The tax has been burdensome to them.
“The state reviewed the tax and after taking the views from all aspects…agreed to impose a 10% rate instead,” Phoong told reporters in reporting his 100-day stay in office here today.
According to Phoong, a study was done and found that the old rate was viewed widely as regressive among the scrap metal exporters and did not bring any significant growth in terms of revenue for the state.
Phoong said the government will now use the London Metal Exchange and barchart as a reference point for current metal prices.
He said the metal prices were unregulated before due to the non-existent of such reference points.
Phoong also added the state’s Industrial Development and Research Department has now been given the authority to register all scrap metal collectors and dealers who are in use of a weighing scale.
He said they also need to obtain a licence to operate, adding that the state will also develop a database on their operations.
“For those who held Sabah government approval licences, they need to update their information at the database every month and renewal licences have to be made every two years.” – The Vibes, April 12, 2023
