More reasons to honour the 40pc tax right: Star
Published on: Friday, June 20, 2025
Published on: Fri, Jun 20, 2025 Text Size: Hiew said the people of Sabah have long endured the underdeveloped infrastructure, lack of educational resources, and insufficient healthcare facilities, a reality of imbalanced development. Kota Kinabalu: The expanded Sales and Services Tax (SST) set to be implemented in July, introduction of a targeted subsidy mechanism for RON95 petrol and the federal government's plan to implement a carbon tax by 2026, are reasons enough for the federal government to immediately implement Sabah's constitutional right to a 40pc net revenue return, without further excuses or delays. Star Tg Aru Division chief Hiew Choon Yu said according to the latest projection by the Inland Revenue Board (IRB), Sabah's tax revenue is expected to reach RM6.2 billion in 2025—a historic high that clearly demonstrates Sabah's major contribution to the national economy and tax system.
Advertisement Hiew said the people of Sabah have long endured the underdeveloped infrastructure, lack of educational resources, and insufficient healthcare facilities, a reality of imbalanced development. 'Meanwhile, the taxes collected from Sabah by the federal government each year are grossly disproportionate to the allocations returned to the state. 'Under Articles 112C and 112D of the Federal Constitution, Sabah is entitled to 40pc of net federal revenue collected from the state. However, this constitutional guarantee has never been truly enforced since 1969,' he said. He added that since 1974, Sabah's 40pc net tax revenue return has never been comprehensively reviewed or reassessed. Despite repeated government promises to review it, there has been no concrete progress.
Advertisement 'In 2022, the Ministry of Finance even admitted the matter required 'further study,' deeply disappointing the people,' he said in a statement. Hiew noted that since 2024, the government has expanded SST to cover services including logistics, delivery, entertainment, maintenance, and repair—proving that the federal government already possesses the resources and mechanisms to redesign and implement tax policies 'Sabah is not a marginal state begging for handouts—it is part of the Federation and should receive a fair share of fiscal distribution.' * Follow us on our official WhatsApp channel and Telegram for breaking news alerts and key updates! * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available.
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