KOTA KINABALU: Sabah government needs to come up with a proposal for a special grant formula that can be accepted if it disagrees with the formula proposed by the Federal Finance Ministry, said Datuk Ewon Benedick (Upko-Kadamaian).
Ewon made the suggestion when debating the Sabah Budget 2024 at the state assembly sitting here.
"I suggest that the consultative committee that was established previously, led by the Minister of Finance, be empowered with a team of experts consisting of professionals in the fields of law, taxation, accounting, audit, finance, former judges, arbitration and so on to help the Sabah government submit a formula proposal that remains based on constitutional interpretation and analysis of taxes and federal revenue in Sabah.
"I suggest the return of 40 per cent of the federal revenue collected directly from Sabah, especially income tax and customs revenue. Indirect collection such as taxes on multinational companies operating in Sabah but registered outside Sabah which causes them to pay taxes without going through the revenue office in Sabah should be discussed separately.
"This proposal is to enable Sabah to enjoy additional revenue to the State Budget more immediately while continuing negotiations on indirect federal revenue collection," said the United Progressive Kinabalu Organisation (Upko) president.
He also proposed the Sabah government explore the potential of creating a special enactment in the state assembly over the re-collection of federal revenue to uphold what has been stated in the Federal Constitution.
Furthermore, Ewon said the Sabah government should have equity in every multinational investment to increase the state government's revenue.
"To further increase the revenue of the Sabah government, I would also like to propose that the government require the ownership of state equity in every direct investment by national or foreign multinational companies carried out in Sabah.
"This includes multinational companies that wish to obtain an extension of existing leases for those involved in the plantation sector," said Ewon, who is the federal Entrepreneur Development and Cooperatives minister.