By Olivia Miwil
KOTA KINABALU: Sabah is considering providing incentives for companies undertaking downstream activities in the state.
State Finance Minister Datuk Seri Masidi Manjun said companies that intend to process their products within Sabah could be exempted from the State Sales Tax or charged a reasonable rate.
"This would allow companies to channel more financial resources into research and development (R&D) and downstream processing activities," he said, adding that the state government had started studying the matter and held engagement sessions with stakeholders last month.
Masidi, who is also Sabah Deputy Chief Minister, was responding to a supplementary question from Upko-Moyog assemblyman Datuk Donald Mojuntin during the state legislative assembly sitting on whether the government would consider reviewing the State Sales Tax for certain sectors to enhance Sabah's competitiveness.
Earlier, assistant state Finance Minister Datuk Ben Chong said Sabah collected RM1.387 billion in State Sales Tax as of June 30, 2026.
Of the total, RM679.45 million was collected from petroleum products, RM703.55 million from crude palm oil and RM4.22 million from fisheries.
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