Kota Kinabalu: Sabah is expected to receive about RM3.019 billion in federal revenue for 2025 under the 40 per cent constitutional revenue-sharing formula, Finance Minister Masidi Manjun said.
He said total direct taxes collected by the Inland Revenue Board and indirect taxes collected by the Customs Department from Sabah are estimated at RM7.547 billion for 2025, with 40 per cent of that amount forming the basis of the special grant.
“We must respect the ongoing negotiations. For now, I can only disclose publicly available tax data,” Masidi
(pic) said after Deputy Finance Minister Ben Chong responded to a question from Sekong (Warisan) Assemblyman Alias Sani.
Chong said the Federal Government has submitted partial tax data from Sabah covering the period from 1974 to 2025, but the information is strictly for negotiation purposes and cannot be made public.
He added that the data was presented during a series of meetings between January and March by a special committee comprising federal and state officials.
The figures include various revenue streams such as direct and indirect taxes, non-tax income, and petroleum-related revenue, including royalties and petroleum income tax.
“However, whether all these components will be counted as “federal revenue derived from Sabah” for the calculation of the grant is still under negotiation.
Chong said the Sabah Government had written to the federal authorities on March 18, proposing that the undisputed portion of the payment be released first, with the disputed amounts verified and settled later.
He added that the state also maintains the RM600 million special grant allocated for 2026 should be reviewed in line with the 40 per cent formula under Article 112C of the Federal Constitution.
On legal developments, Chong said the state respects the Court of Appeal’s April 6 decision to temporarily suspend Sabah’s 40 per cent entitlement pending the outcome of an appeal.
However, he stressed that the ruling only applies to claims for the period between 1974 and 2021, often referred to as the “lost years”.
He said the State Government wrote again on April 10, urging Putrajaya to expedite payments for the 2022 to 2025 period and the current year, noting that the Federal Government has decided not to appeal a High Court ruling affirming Sabah’s right to the 40 per cent grant.
“Sabah will not yield or compromise when it comes to securing its rightful entitlements,” he said.
Despite the temporary suspension, Chong said the state would continue negotiations, including data verification and assessment, to ensure Sabah receives a fair share of federal revenue.
Responding to further questions, Masidi said Sabah’s claim is not limited to income tax and customs duties but also includes other revenue sources such as petroleum-related taxes, which are still under discussion.
“All taxes that we believe we are entitled to, we will claim, regardless of type,” he said.
Sabah has long maintained that it is constitutionally entitled to 40 per cent of net revenue derived from the state, an issue that has led to prolonged negotiations and legal disputes with the federal government.
