Freeze Penang land tax, water tariff hikes for 1 year, says Guan Eng

 The Air Putih assemblyman says the state and PBAPP can absorb the RM70 million in foregone revenue to ease the people’s burden.

Air Putih assemblyman Lim Guan Eng said the impact on ordinary people and businesses would be far greater than the additional revenue gained by the state and Penang Water Supply Corporation. (Facebook pic)

GEORGE TOWN:

Lim Guan Eng has urged the Penang government to defer its land tax increase and a scheduled water tariff hike for at least a year, saying the state should not add to the people’s financial burden amid uncertain economic conditions.

The former Penang chief minister said the freeze would cost the state government and the Penang Water Supply Corporation (PBAPP) about RM70 million in foregone revenue, which he said both entities could absorb.

Lim (PH-Air Putih) said the state was expected to collect an additional RM50 million from the land tax revision, while PBAPP would gain about RM20 million from an average 20 sen per cubic metre increase in water tariffs from July 1.

“The RM50 million and RM20 million can be borne by the state government and PBAPP, respectively,” he said when debating the governor’s address in the Penang state assembly.

He added that the impact on ordinary people and businesses would be far greater than the additional revenue gained by the state and PBAPP.

Lim said the proposed freeze should last for one year, or until the global economic crisis eased.

He said the conflict in the Middle East had pushed up oil prices, disrupted supply chains, and increased the cost of raw materials and logistics.

Lim said if the state government or PBAPP urgently needed the funds, they could seek financing from the federal government instead of passing the cost on to the public.

In May last year, Penang chief minister Chow Kon Yeow said the state was facing a cash flow problem and a possible deficit of up to RM500 million, prompting it to seek a RM100 million advance from Putrajaya as a buffer.

Table Perak water deal in assembly first

Lim also said any agreement on the purchase of treated water from Perak should be tabled in the state assembly before it is signed.

He said the proposed deal, involving up to 500 million litres of treated water, could eventually push PBAPP’s tariffs to RM3 per cubic metre or more – almost five times the current average tariff of 62 sen.

He said that while 20,000 litres would cost about RM12.40 at 62 sen per cubic metre, the same volume would cost RM60, before other charges were added, if the tariff was raised to RM3 per cubic metre.

Lim said the higher tariff would take effect once treated water supply began in about 10 years, with the project expected to start in 2031.

He said the agreement should not be decided solely by PBAPP or PBA Holdings Bhd board members as it involved public water supply and affected all 1.8 million people in Penang.

He said the public must also be assured that the agreement would represent the best possible deal for Penang. - FMT