PUTRAJAYA, June 14 — The National Finance Council (NFC) has asked the state governments to continue to adopt proactive measures to cut the arrears of their revenue collection which had exceeded RM2 billion a year from 2011 to 2015.

Prime Minister Datuk Seri Najib Razak, who is also Finance Minister, chaired the meeting today.

He said the state revenue committees agreed to the proposal.

“Among the initiatives implemented by the state governments were to give a 10 per cent rebate for those who pay their taxes early and provide mobile counters housed in vans.

“The state governments’ efforts will be monitored from time to time and will be reported to the NFC,” he told a media briefing after the council meeting at the Finance Ministry here today.

Also present were Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, Deputy Finance Ministers Datuk Chua Tee Yong, Datuk Johari Abdul Ghani and Chief Secretary to the Government Tan Sri Dr Ali Hamsa.

All the menteri besar and chief ministers attended the meeting except the Menteri Besar of Pahang Datuk Seri Adnan Yaakob.

Najib said the Urban Transformation Centre was one channel which would help state governments collect taxes and reduce arrears.

“Non-revenue water and rents from public housing which are not paid were among the sources which resulted in revenue arrears for the states,” he said.

He said the NFC has agreed to set up a Loan Recovery Committee (LRC) to help states collect the arrears.

“The LRC, which will be led by Finance Ministry and chaired by Finance Ministry Secretary-General Tan Sri Dr Mohd Irwan Serigar Abdullah, will identify the loans that are in arrears,” he said.

The committee will also monitor and report to the NFC the actions by the state governments to settle the loans, he said.

“The state government representatives will be invited to discuss ways to help clear the backlog,” he said.

Meanwhile, Najib said, the NFC has agreed that the federal government provide an additional RM330 million to the State Reserve Fund to help states facing deficits.

“For the record, the contribution that was approved for this year was RM580 million and for 2017 RM530 million,” he said. — Bernama