REVERTING tourism to the state list of the federal constitution has been temporarily put on hold as Sarawak prioritises resolving more pressing disputes with Putrajaya, the state’s Minister for Tourism, Creative Industry and Performing Arts, Abdul Karim Hamzah said today.

He said resolving the long running territorial dispute over who controls the continental shelf within the state’s 200-mile exclusive economic zone (EEZ) and the Petroleum Development Act (PDA) 1974, which the state has declared it does not recognise, are now the top priorities of the state government.

Sarawak has long viewed the PDA 1974, a parliament enacted law, as infringing the state’s rights on its land and the natural resources within it because the law provides that ownership of crude oil and natural gas resources together the exclusive rights, powers, liberties and privileges of exploring petroleum offshore Sarawak belongs to Petronas.

“We don’t really want to make that into a big issue (at the moment). We (just) leave it as it is for the meantime,” he said when speaking to reporters after opening Kuching’s first “smart” hotel, Kuching Park Hotel, this afternoon.

“There will come a time when we might have to revisit it,” he added, when asked if Sarawak would be impacted by the collection of the tourism tax if tourism returns to the federal list.

The collection of the tourism tax, suspended due to the Covid-19 pandemic, has restarted from January 1.

The lists, in the 9th Schedule of the federal constitution, details the specific responsibilities of the federal and state governments.

Karim said the state is also unconcerned with the state’s share of the tourism tax as it was “small”.

He said the amount of revenue the state collected from other sources, principally oil and gas, are bigger”.

Sarawak’s share of the tourism tax, before collection was suspended sometime in 2019, was just RM5 million.

The amount pales in comparison to the RM5.6 billion the state collected last year in state sales tax (SST) on oil and gas products, oil palm products and aluminum.

The SST on these four commodities contributed 84% of the revenue collected.

Sarawak’s main sources of revenue are from taxes, non-taxable revenue, non-revenue receipts, and federal grants and reimbursements.

Taxes contributed RM6.7 billion or 56% of total revenue earned, while the other categories made up 44%. –  February 21, 2023.