Harris: Multiple taxes on a single produce not a good practice for Sabahans

KOTA KINABALU; The state and federal governmenst as well as the Malaysian Palm Oil board (MPOB) should look into the actual financial burden of the state’s oil palm industry in view of the current global economic turmoil.

Former Chief Minister Datuk Harris Salleh said for the sake of the industry, especially the smallholders, an urgent review of the effects of the various taxes and levies must be carried out.

In a statement issued here yesterday, the former Chief Minister claimed that Sabah’s oil palm plantations did not get equal treatment compared to plantations in the peninsula as they were being subjected to all kinds of taxes which were calculated on the basis of yearly total production.

For instance, Harris said it is only in Sabah that oil palm plantations have to pay 7.5 per cent sales tax MPOB cess of Rm15 per tonne, 7.5 per cent windfall tax for CPO and another 7.5 per cent for CPKO have to be paid to the federal government.

‘All these taxes are passed on to the plantations at source by the millers which comprise large public listed plantations that can afford to have palm oil mills,” he said.

He said the sales tax alone from the CPO volume of 5,561,485 last year amounted to RM987 million while the MPOB collected RM83,422,275.

Harris also said it was not a good practice for Malaysia to have multiple taxes on a single produce, all the more so when these taxes were being introduced on the spur of the moment.

He claimed that the industry was on the way to being a sunset industry especially for the smallholder planters.

“For the sake of the industry’s survival, it is therefore proposed that the federal government and MPOB taxes be abolished immediately.

“This proposal is based on the dissatisfaction voiced by the smallholders themselves,” he said, adding that their grouses were founded as they realized that Sabah, as the biggest oil palm producer was being used as a cash cow.

He however said the taxes imposed and were due to the state government should remain so as to help the state to develop the agriculture sector.

New sabah Times
21/09/08