Sarawak to impose a 1% sales tax on aluminium products exports from January 1

Sarawak, a Malaysian state on Borneo, will reportedly levy a 1 per cent sales tax on its exported aluminium products from January 1, 2020. The news came after Sarawak’s Chief Minister Abang Johari Openg said this today while tabling the 2020 state budget. He also said that this new tax would bring an expected revenue of RM58 million.

According to him, this tax is to aid the state’s efforts in maintaining momentum and keeping pace with development, especially for rural areas that require substantial funding.

The tariff for the abstraction of raw water will also be revised from 1 sen per cubic metre to 2.5 sen per cubic metre. However, the tariff will only affect power and water providers in the state, said Openg.

“The electricity and water charges to consumers for both industrial and residential will remain unchanged,” he said.

Given Sarawak’s estimated total revenue of RM10.67 billion and its proposed ordinary expenditure of RM9.694 billion, Abang Johari Openg expects the budget to generate a surplus of RM373 million.

He said this surplus amount could be utilised in building up the state’s financial reserves and ensuring financial sustainability in the long run.