Continental shelf: State Government working on amendments
Published on: Friday, April 26, 2024
By: Larry Ralon
Masidi said this in response to a supplementary question from Tungku Assemblyman Assaffal P Alian who raised the need for Sabah to make a stand in the Assembly that Sabah’s continental belongs to the State so it can fully benefit from it in terms of revenue from oil and gas.
Kota Kinabalu: The State Government is working on amendments to an enactment to support its stand on Sabah’s continental shelf, said State Finance Minister Datuk Seri Masidi Manjun.
He said this in response to a supplementary question from Tungku Assemblyman Assaffal P Alian who raised the need for Sabah to make a stand in the Assembly that Sabah’s continental belongs to the State so it can fully benefit from it in terms of revenue from oil and gas.
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Masidi said the State Cabinet had already discussed the issue.
“God willing, in the near future, the Chief Minister will make an announcement regarding this matter after we have finalised our proposals. I can only say that our stand is that we recognise that for the calculation of territorial jurisdiction we adhere to the Order and Council 1954.
“So when we talk about the Order and Council 1954, with all land areas, we assume that land includes the land in the sea. So it is only natural that we should consider whether our rights include the sea.
“It does not only involve a stand made in the State Assembly. It may involve some amendments to an enactment which we are working on.
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“We have discussed this issue at length in the Cabinet and we think we should all work together on this because it is for the best interest of not only the current government but also the future government which can also benefit from our stand.
“I hope all the State elected representatives will support when the time comes,” he said while winding up for his Ministry.
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Earlier, to a question from Datuk Seri Mohd Shafie Apdal (Warisan-Senallang), Masidi said the State Government will always work with various agencies to increase revenue.
He said among the initiatives that will be implemented include facilitating the exploration of new revenue implemented by other ministries/departments/agencies such as carbon credit, conservation fees and others, as well as constantly exploring and studying the imposition of new taxes to expand the product and scope of the imposition of State Sales Tax (SST).
“For information, so far, there are 8 taxed products of which two were just introduced on April 1, 2024, namely silica sand/silica and palm oil biomass brought out of Sabah with estimated SST collection amounting to RM12.0 million per year,” he said.
In addition, he said the State Government will review and improve the contract agreement/ordinance regarding the royalty rate charged.
“As I informed before, the 5pc gold royalty is proposed to be increased to 10pc and charged when the gold is melted and not when it is sold. If this can be implemented, the gold royalty rate will double. In addition, SST will also be charged on gold that is taken out of Sabah.”
Besides that, he said his Ministry will also improve the management and operations of State Government-owned companies and statutory bodies to increase profits and subsequently be able to pay high dividends and contributions to the State Government.
“The State Government will also review the service/licensing rate in line with improving the quality of service delivery to the people.”
In addition, Masidi said the State Government will also continue negotiations with the Federal Government regarding special grants under Part IV, Tenth Schedule, Federal Constitution and other grants that Sabah is entitled to claim.
He called on all supervisory officers in the State Government ministries/departments to ensure the implementation of Finance Ministry circular No. 1/2022 to improve the management of the State Government revenue collection and introduce more efficient revenue collection operations and ensure that revenue leakage can be zeroed out.
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