Malaysia
Sabah to Putrajaya: Pay up the 40pc revenue now, we’ll keep fighting for bigger billions later
Sabah Finance Minister Datuk Seri Masidi Manjun (right) speaks at the State Assembly on April 28, 2026. — Picture courtesy of the Sabah Finance Ministry

KOTA KINABALU, April 28 — Sabah has formally asked Putrajaya to immediately pay its 40 per cent revenue entitlement amounting to just over RM3 billion, with state Finance Minister Datuk Seri Masidi Manjun insisting the claim is based on undisputed and publicly available tax data.

Masidi said the state government wrote to the federal government on April 10 seeking payment of 40 per cent from two forms of taxes – customs and income tax – collected in Sabah which alone totalled RM7.547 billion in 2025.

“Forty per cent of that comes to RM3.019 billion. These are not figures in dispute – they are published statistics. There should be no room for doubt, and on that basis alone, the payment should be made,” he said in the State Legislative Assembly today.

Masidi stressed that while ongoing legal proceedings have delayed broader claims, particularly those involving “lost years” between 1974 and 2021, Sabah is seeking immediate payment for more recent years where the data is clear and uncontested.

He said the state respects a Court of Appeal decision on April 6 to defer implementation of Sabah’s 40 per cent entitlement pending an appeal at the High Court in Kota Kinabalu, but emphasised that the decision relates specifically to retrospective claims.

“The delay authorised by the Court of Appeal concerns the special grant for past years. It does not negate our position on current entitlements, which are based on transparent and shared data,” he said.

Masidi added that Sabah would not compromise on what he described as the state’s “absolute right”, and that negotiations with the federal government are continuing through official negotiation channels rather than through the public media domain.

He also said that while some figures cannot yet be disclosed due to ongoing negotiations, the state’s internal estimates suggest Sabah’s total claim could be significantly higher.

“Out of respect to ourselves, and to the negotiation process, we cannot disclose figures other than those that have been made public,” he said.

To other supplementary questions, Masidi affirmed that Sabah’s claim extends beyond income tax and customs duties to include other revenue streams, including petroleum-related duties, though these remain 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, a provision that has been the subject of protracted negotiations and legal disputes with the federal government.

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