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Thursday, May 7, 2020

Petronas fails application to stay payment of RM1.3bil to Sarawak



KUCHING: The High Court here has dismissed Petronas' application for a stay of proceedings to enforce the payment of state sales tax on petroleum products amounting to over RM1.3bil to the Sarawak government.
Judge Azhahari Kamal Ramli ruled that Petronas had failed to prove special circumstances to justify a stay of the enforcement proceedings.
Petronas applied for the stay pending the hearing of its appeal against the dismissal of its judicial review application on March 13 to declare the state sales tax unconstitutional.
The appeal is fixed for hearing in Putrajaya on June 17.
In the hearing of the stay application, Petronas argued that it would suffer financial hardship if it had to pay RM1.3bil to the state government before the appeal was heard.
It also said its revenues and ability to pay dividend to the Federal Government would be affected if forced to pay the tax, due to current low oil prices caused by falling global demand and the Covid-19 pandemic.
However, Justice Azhahari ruled that a taxpayer's financial hardship was not ground to justify a stay of the enforcement proceedings.
"The established legal principle is that a stay or suspension is not granted to give anyone time to settle its taxes or what it owes," he said when dismissing the application on Wednesday (May 6).
His ruling was delivered online via Skype, while the hearing of the case on April 29 was also done on Skype.
Justice Azhahari also said the state government could refund the sum paid by Petronas should the national oil corporation win its appeal, as Sarawak had accumulated reserves of more than RM27bil according to the Auditor-General's Report 2018.
He added that Petronas' argument that its appeal would be rendered futile if it had to pay the tax beforehand had no merit.
State legal counsel Datuk Seri J.C. Fong and state Attorney General Datuk Talat Mahmood Abdul Rashid appeared for the state government while counsel Datuk Malik Imtiaz Sarwar and Alvin Chong represented Petronas. - Star

2 comments:

  1. All anak watan Sarawak-mali + fair-minded fellow brethren Malaysia-wide hope 'tis unfavorable decision against the national behemoth (i.e. Oligarchy-like PETRONAS) ain't just one pyrrhic victory per se. God Is Great!

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