A COMMITTEE has been set up to facilitate negotiations between Sarawak and the federal government to find commercial solutions to the state’s claims against Petronas for payment of sales tax and a 20% oil royalty.

Prime Minister Muhyiddin Yassin said the committee was co-chaired by Senior Minister Fadillah Yusof and Finance Minister Tengku Zafrul Abdul Azi.

He said the committee convened its first meeting on June 17 at the Finance Ministry (MoF) and it was attended by the Sarawak delegation led by Deputy Chief Minister Amar Awang Tengah Ali Hasan and PEtronas representatives.

“Negotiations are still ongoing between the three parties,” Muhyiddin said in a written reply to a question from Saifuddin Nasution Ismail (Kulim Bandar Baru-PH) who wanted to know about the status of the Sarawak government’s claims against Petronas.

Muhyiddin said the federal government, represented by the MoF, and Petronas were negotiating with the Sarawak government over the claims.

Following talks between the three parties, he said it was agreed that issues related to the Sarawak sales tax shall be resolved through negotiations instead of legal action.

On August 3, Petronas withdrew its appeal over its failed judicial review application against the Sarawak government and the state’s Comptroller of State Sales Tax demanding payment of more than RM2 billion in sales tax.

Likewise, the Sarawak government also withdrew its cross-appeal over the issue of the High Court’s jurisdiction over the state sales tax. – Bernama, August 11, 2020.