Petronas finalising terms of 5% SST payment with Sarawak

Petronas Twin Towers — DayakDaily.com file pic. // Photo: Pixabay

By Peter Sibon

KUCHING, June 23: Petronas is now finalising its payment for the 5 per cent State Sales Tax imposed by Sarawak Government on oil products produced in the state.

In a letter of its appeal to the Court of Appeals today, it sought for adjournment of the hearing of its case involving payment of the said State Sales tax which has been fixed for hearing today.

Petronas lawyers’ application for the adjournment of the hearing mentioned that the case be deferred as Petronas is currently negotiating with the respondents, ie the Comptroller of the State Sales Tax of Sarawak and State Government of Sarawak.

“Petronas however, requires time to comply with its internal governance process to do so. Petronas undertakes to withdraw the appeal by of before the adjournment date,” read the letter in Court today.


Petronas lawyers added that they have been instructed to request that the adjournment date be scheduled on July 31, 2020 or any immediate date thereafter in order to allow for the foregoing process to take place.

Court of Appeal judge Kamaludin Md Said had adjourned Petronas’ appeal to a fixed day in August, pending the settlement. Other judges who sat with him were Ravinthran Paramguru and Abu Bakar Jais.

Sarawak Legal Counsel JC Fong had told the court that the state government did not object to the postponement as Petronas had made the undertaking to withdraw its appeal based on its letter.

Petronas filed the appeal against the Kuching High Court’s decision to dismiss its judicial review to challenge Sarawak’s Sales Tax Ordinance 1998 requiring it to pay the state a 5 per cent sales tax on petroleum products.

Petronas has that Sarawak State law used to impose the tax was unconstitutional.

Sarawak began imposing the tax on its petroleum products on Jan 1, 2018, under the Sales Tax Ordinance 1998. It also sued Petronas for unpaid State Sales Tax and penalties amounting to RM2.878 billion for 2019.

Recently, Chief Minister Datuk Patinggi Abang Johari Tun Openg revealed that Petronas would not appeal against the decision of the High Court which has awarded Sarawak its right to impose on the State Sales Tax.—DayakDaily