By ZAINNAL AJAMAIN
COMMENT: I find that in Teo Chee Kang vs Darell Leiking (arguments) on the Malaysia Agreement 1963 that has been coming out in mainstream and alternative media interesting.
On one side we have a representative from the Government and on the other a representative from the Opposition.
It is very sad that even though we have the government representative, he does not appear to know and understand the way the Federation works. Perhaps he is trying to protect his masters in Putrajaya but at the same time to ensure he does not get too much heat from Sabah and Sarawak.
The FIRSTBORN Society is continuously watching how the Malaysia Agreement 1963 is being played out by both sides of the political divide.
As stated by Teo there should be two hands to clap; in this case the Federal government must also honour and respect which rights belong to Sabah, and when Sabah enacts a law to regulate this right the Federal government is obliged to accept the decision of the state.
For example, in Annex A Inter-Governmental Report item 7(ii) of the Federal List it was stated that there is also State Sales Tax. The Federal government must respect this right and not simple take it as their rights. I have explained this in breach No.2 of the Malaysia Agreement 1963 – Import Duty and Excise Duty of Petroleum Products. This can be found in Schedule 10 Part V item 1 of the constitution.
However, when the Federal Government implemented AFTA in 1999 there was a need to eliminate Import Duty and Excise Duty for Petroleum Products. In its place the Federal Government introduce the Specific Tax under the Sales Tax Act 1972.
The main reason for this tax was so that the Federal Government does not lose its income from Import Duty and Excise Duty of Petroleum Products. In this context, the Federal Government maintains its income including those which was supposed to be collected for Sabah and Sarawak.
Sabah and Sarawak loses its income from Import Duty and Excise Duty of petroleum products; in its place the Federal Government gives a fixed grant in lieu of the Import Duty and Excise Duty of petroleum products.
Therefore, Teo appears to allow the Federal Government to clap by just using one hand, and yet says that Sabah cannot clap with just one. Since Teo is a Sabah Minister that looks after the rights of Sabah, he should know that under the IGC, Sabah has its own power to impose State Sales Tax.
Therefore it can pass its own enactment to impose this tax without having to beg the Federal Government for permission – therefore, who is it that really does not know how the Federation works?
As for Article 112D that Teo provides as an example, all he needs to do is to write a letter to the Federal Ministry of Finance and find out how much the Federal Government has collected from Sabah in terms of income tax.
Corporate tax (especially timber and plantation companies), profits from Telcos, FELDA etc. Then just deduct 40% from that amount – is it that difficult? The Federal Government may refuse to cooperate or that they may be just giving wrong figures.
If the Federal Government refuse to cooperate, then it is up to the State Government to appoint an assessor, this is clearly given in the IGC report.
In addition, if Teo or his team cares to read the Malayan parliamentary Hansard dated 12 August to 20 August 1963, they would come across a discussion that the proposed assessor should come from the World Bank.
If Teo suspects that the Federal Government is giving the wrong figures, then he should acquire the services of the Institute for Development Studies (IDS) Sabah – this was the reason it was created in the first place.
Is the Sabah government paying them (IDS) to do nothing?
As far as I am concerned, Teo is making all sorts of excuses just to protect his masters in Putrajaya at the expense of all Sabahans. If Teo does not know what to do, we in the “opposition” are always ready to assist – all you need to do is ask, please.
• Zainnal Ajamain is Chairman of Pertubuhan Generasi Anak Sulung Sabah, or FIRSTBORN
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