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By withdrawing his appeal, Petronas recognizes Sarawak’s constitutional rights and that they are bound by the laws and decisions of the state court that, prior to this, the corporation refused to recognize.
KUCHING: The Sarawak government has agreed to an agreement with Petroliam Nasional Berhad (Petronas) on the State Sales Tax (SST) not because the state has a weak case and cannot risk in the courts of appeal, the law minister said de facto of the state, Datuk. Sharifah Hasidah Sayeed Aman Ghazali.
Responding to questions raised by Parti Sarawak Bersatu President Dato Sri Wong Soon Koh about the deal, he said it was reached after Petronas was unable to submit his request to defer or suspend SST payment for 2019 until the disposition of his appeal in June. 17, 2020.
“That Petronas has agreed to pay the entire expired SST by 2019 and withdraw its appeal, must be considered as its unequivocal recognition or admission of the State’s constitutional right to impose SST on petroleum products and its acceptance of the Judgment from the High Court that declared that the state has such constitutional authority to impose SST, “said Sharifah Hasidah, who is the Assistant Minister for Law, State-Federal Relations and Project Monitoring.
“Upon withdrawing the appeal, Petronas agreed to be bound by the decisions of the High Court in which the High Court decided that Sarawak’s rights are protected by the Federal Constitution, the 1963 Malaysian Agreement and the Recommendations of the Intergovernmental Committee Report. 1962, “he said. in a sentence.
Hasidah emphasized that in withdrawing his appeal, Petronas recognized Sarawak’s constitutional rights, including under the 1963 Malaysia Agreement and the Intergovernmental Committee Report, and that they are bound by state law and the Court’s decisions that, prior to this , corporation refused to acknowledge.
Sharifah Hasidah added that under the terms of the agreement, Petronas would pay in full to the Sarawak government’s SST by 2019.
He said this amounted to around RM2 billion, excluding legal penalties for late payments and accrued interest on the amount assessed from the date of the Notice of Assessment until full settlement.
“The SST for the year 2020 is maintained at five percent of the sale value of petroleum products. Assessment notices have only been issued for the first quarter of 2020. There is still no agreement for the reduction of the SST for the current year 2020, ”he explained.
She said Wong’s claim that “the O&G advance tax for two years (for 2019 and 2020” totaled RM 6.775 billion “) was settled for a greatly reduced sum of RM2 billion was completely false and misleading.
“The RM2 billion paid by Petronas is only SST for the year 2019 and excludes SST paid by other oil companies such as Shell, Murphy Oil, Pertamina and others that operate in the state. The amount of SST to be raised in 2020 has not yet been determined.
“Whether there would be a reduction in the SST rate in the coming years would depend on the outcome of the” trade agreement “that will be reached, with the resumption of negotiations between the state government, Petros and Petronas,” he said.
In addition, he noted that such a trade agreement would involve increased state involvement in the upstream operation (both offshore and onshore), as well as investments in downstream businesses and industries, to allow the state to have a more equitable share of oil yields. and gas produced within the Sarawak boundaries.
“The GPS state government remains firmly committed to upholding Sarawak’s sovereign rights to the state’s oil and gas resources. It has amply demonstrated this by bringing Petronas to court over OSH issues, ”said Sharifah Hasidah.
“The state government will solve all other problems through ongoing negotiations with the federal government and Petronas. The result of these negotiations will ultimately bring more investments in the oil and gas sectors to sustain the growth of related industries, and will allow the state, through Petros, to improve its participation in the upstream and downstream areas of the oil industry, “he said.
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