Sarawak govt will sue Petronas if it doesn’t pay 5pct sales tax by October, says Abdul Karim

KUCHING: The Sarawak government will pursue legal action against Petronas if the national oil giant does not pay the five per cent sales tax imposed on petroleum products by October, said Tourism, Arts and Culture Minister Datuk Abdul Karim Rahman Hamzah.

“We have given them until October to pay. If they don’t, then we have to sue them. We will have to sue them. We are prepared for that. We cannot wait,” said Abdul Karim at a press conference after the opening ceremony of 10th Asian Bird Fair 2019 at Kuching Waterfront here today.

He said other oil companies operating in the state namely Shell and Murphy Oil had already paid up and Petronas is the only one unwilling to pay.

The five per cent sales tax, announced during the tabling of State Budget 2019 during the State Legislative Assembly (DUN) sitting last year, was to support the state government in undertaking major development programmes and projects.

“The tax is levying on crude oil, natural gas, liquefied natural gas, chemical-based fertilisers and gas to liquid products.

“The law is very clear. If you don’t pay, that means it’s an offence,” said Abdul Karim.

Abdul Karim said Petronas requested for a deferment on payment for the five per cent sales tax imposed on petroleum products effective Jan 1 this year to June and it was agreed by the state government.

With October approaching, Abdul said Petronas still has not paid up and it had negated the agreed timeframe for the national oil company to pay up the five per cent sales tax imposed by the state government.

“Now it is already way past June and you are turning back against the whole thing. Who are you (to do so)?” said Abdul Karim, who was visibly aggravated.

“You (Petronas) cannot be bigger than a state. You are just a corporation. You cannot be bigger than the state government of Sarawak which produces the most oil and gas in Malaysia,” said Abdul Karim.