SARAWAK was forced to dip into state reserves to fund development projects after Petronas failed to pay the 5% petroleum state sales tax (SST) last year, said Deputy Chief Minister Douglas Uggah.

He told the state assembly today that Petronas failed to meet its obligations and pay the SST even though it is legally obligated to do so.

Uggah, who is also the second finance minister, said the state’s 2019 budget was formulated as a surplus budget based on the assumption that the projected revenue would include the SST from the national petroleum company.

He was responding to questions from Sarawak DAP chairman and Kota Sentosa assemblyman Chong Chieng Jen in his debate on the state’s reserve in 2018 and last year.

Uggah said the state is committed to implementing strategic and “impactful” projects beneficial of the people.

Some of the approved federal projects were cancelled by the previous Pakatan Harapan government, he said, alluding to the five major bridges on the state’s coastal highway and rural projects allocated to the Gabungan Parti Sarawak (GPS) MPs who were then in the opposition.

“Thus, as an interim measure, we have to tap into our reserve to fund the implementation of all these projects.”

That dipping into the state reserve, Uggah said, led to reduced reserves of RM23.97 billion at the end of last year.

This year’s amount is estimated to reach RM25.2 billion.

Uggah also said the state also has investment in both listed and unlisted companies worth RM7.645 billion.

He told Chong these reserve figures are published annually in the official auditor’s-general report. – November 13, 2020.