S’wak govt has every right to implement State Sales Taxes — Asfia

The Sarawak Legislative Assembly complex.

KUCHING, Oct 18: The state government has every right to implement the State Sales Taxes, as it is legislated under the State List Article 95B(3).

According to State Legislative Assembly (DUN) speaker Datuk Amar Mohd Asfia Awang Nassar, Sarawak has the right to collect revenue as stated in Item 1, Part lll, 9th Schedule of the Federal Constitution, which touched on “revenue from lands, mines and forests”.

He said under Item 7, Part V of the 10th Schedule of the Federal Constitution, Sarawak has the right to impose State Sales Taxes and the subject matter legislated thereon shall be deemed to be under State List [Article 95B(3)].

In addition, 9th Schedule Item 8(j) of the Federal Constitution, subject to item 2(c) in the State List, touched on development of mineral resources; mines, mining, minerals and mineral ores; oils and oil fields; purchase, sale, import and export of minerals and mineral ores; petroleum products; regulation of labour and safety in mines and oil fields.

“The Legislature of the State of Sabah or Sarawak may also make laws for imposing sales taxes, and any sales tax imposed by the State Law in the State of Sabah and Sarawak shall be deemed to be among the matters enumerated in the State List and not in the Federal List.


“The operative word ‘and’ must be construed conjunctively and not disjunctively because petroleum originates in Sarawak and the sales take place in Sarawak. Therefore the State Legislature deems it to be in the State List,” said Asfia in a statement today.

Earlier, he received a courtesy visit from Kelantan DUN speaker and their Public Account Committee at the state DUN complex.

As for gambling and crude oil petroleum (CPO), which are in Federal List, Asfia said the state imposed taxes on them because they originate from Sarawak and the sales take place in the state.

“So long as the royalty levied by the state on any mineral chargeable with export duty other than tin (but including minerals oils) does not amount to 10 per cent ad valorem calculated as for export duty, export duty on that mineral or such part of the export duty as makes the total of royalty and duty on exported mineral up to 10 per cent ad valorem so calculated,” he explained.

Asfia pointed out that the federal government pontificates in imposing stamp duties and property gains tax on land transaction in Sarawak, which is the exclusive preserve of the state.

“Article 95C(1) of the Federal Constitution reads: Subject to the provisions of any Act of Parliament passed after Malaysia Day, the Yang di-Pertuan Agong may by order, make as respects any state any such provision as may be made by Act of Parliament.

“(a) for authorising the Legislature of the State to make laws as mentioned in Article 76A; or.

“(b) for extending the executive authority of the State, and the powers or duties of any authority of the State, as mentioned in Clause (4) of Article 80,” he said.

In view of the State Sales Tax, Asfia cited Section 7(1) of the State Sales Tax Ordinance, 1998, which read “A tax to be known as state sales tax shall be charged and collected in accordance with the provisions of this Ordinance on the sale of taxable goods and supply of taxable services rn the state, in the course or furtherance of any business, irrespective of whether or not such taxable goods were made, produced or manufactured in the state.

Section 7(2) of the of the State Sales Tax Ordinance, 1998 also emphatically stated that the revenue derived from the imposition of this state sales tax shall be revenue assigned to the state by virtue of Part V of the 10th Schedule to the Federal Constitution and such revenue shall he paid and credited to the State Consolidated Fund, he explained.

Asfia pointed that the Section 38(1) of the State Sales Tax Ordinance, 1998 reads; “Where an offence against this Ordinance or any regulations made thereunder has been committed by a company, firm, society or other body of persons, any person who at the time of the commission of the offence was a director, manager, secretary or other similar officer or partner of the company, firm, society or other body of persons or was purporting to act in such capacity shall be deemed to be guilty of that offence unless he proves that the offence was committed without his consent or connivance and that he exercised all such diligence to prevent the commission of the offence as he ought to have exercised, having regard to the nature of his functions in that capacity and to all the circumstances”.

He further mention the Section 38(2) of the State Sales Tax Ordinance, 1998, which reads; “Where any person would be liable under this Ordinance to any punishment, penalty or forfeiture for any act, omission, neglect or default of any servant or agent, or of the servant of such agent provided that such act, omission, neglect or default was committed by such servant in the course of his employment or by such agent when acting on behalf of such person or by the servant of such agent when acting in the course of his employment in such circumstances that had such act, omission, neglect or default been committed by the agent his principal would have been liable under this section”.

This followed by prosecution in respect of offences committed under this Ordinance or any regulations made thereunder may be conducted by the Public Prosecutor or any person authorised by him under section 377(h) of the Criminal Procedure Code [Act 593], which was read under the Section 39 of the State Sales Tax Ordinance 1998, Asfia said.

He also cited Section 40 of the State Sales Tax Ordinance, 1998, which reads “Notwithstanding the provisions of any written law to the contrary, a court of a Magistrate in the State shall have jurisdiction to try any offence under this ordinance and to impose punishment under this Ordinance for any such offence”.  — DayakDaily