Return windfall profit levy to Sabah, says Member of Parliament
Published on: Saturday, August 06, 2022
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Chan, who is also DAP Policy Bureau Chief and the party’s spokesperson for Sabah Affairs, said windfall profit levy is supposed to only be collected if there are extraordinary profits as a result of various unexpected and unpredictable factors.
Kuala Lumpur: DAP Member of Parliament for Kota Kinabalu, Chan Foong Hin, called on the Federal Government to spend or return the windfall profit levy collected by the Federal Government to palm oil-producing states in accordance with their respective proportion of production.He made the call while participating in the debate during the second reading on the Bill to amend the Windfall Profit Levy Act 1998 in the Dewan Rakyat.
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Chan, who is also DAP Policy Bureau Chief and the party’s spokesperson for Sabah Affairs, said windfall profit levy is supposed to only be collected if there are extraordinary profits as a result of various unexpected and unpredictable factors.
For example, he said, during the peak of the Covid-19 pandemic, face masks were in high demand and face mask companies made huge profits.
“This year when the economy began to open up after the pandemic, the global industrial supply chain was unfortunately interrupted. The Russian-Ukrainian war was certainly a ‘black swan’ which caused prices of commodities, especially palm oil, to rise due to the shortage in the output of other edible oil from the region at war,” said Chan.
He said he had, prior to the start of the parliamentary session, submitted questions enquiring about the amount of palm oil windfall profit levy collected this year.
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According to a written reply received from Parliament to the question, the windfall profit levy collected from the palm oil industry in 2021 amounted to RM1.9 billion, and RM2.1 billion was collected in the first half of 2022 alone.
Chan said he had also submitted a question on the income of Petronas in 2022 and the answer given was that it was RM25.6 billion in January, RM26.7 billion in February and RM26.5 billion in March. The answer further said the increase in dividend in the first quarter of this year is expected to be between RM2.5 billion and RM3 billion.
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“According to Articles 112C and 112D of the Federal Constitution, Sabah should receive 40pc of the State’s net income. In terms of palm oil windfall profits tax, Sabah accounts for 24pc of the country’s crude palm oil production, so in the palm oil windfall profits tax in 2021, Sabah should be given RM182.4 million, and that RM201.6 million should be spent in Sabah for the first half of 2022,” said Chan.
He said the collection of windfall profit levy should benefit oil-producing states.
“Whether it is palm oil or petroleum oil, both are natural resources obtained from the land and sea of Sabah. Since windfall profit levy, as its name states, is a ‘windfall’, the people of oil-producing states should certainly be entitled to enjoy a piece of the pie,” he said.
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