Govt to receive RM30b special dividend from Petronas for Budget 2019

PETALING JAYA: The government is expected to receive a special dividend of RM30 billion from Petroliam Nasional Bhd (Petronas), bringing the federal government revenue to RM261.8 billion or 17.1% of gross domestic product (GDP) for 2019.
The special dividend will be utilised to fully settle the outstanding tax refunds estimated at RM37 billion comprising RM18 billion of income taxes and RM19 billion of Goods and Services Tax (GST).
According to the "Fiscal Outlook and Federal Government Revenue Estimates 2019" Report, the special dividend will be sourced from the accumulated retained earnings of Petronas.
This way it will not affect the funding of their current investment activities, as the fund for the activities has been accounted in their capital expenditure plan.
On the federal government revenue, tax revenue is estimated at RM176.2 billion and continues to be the key component in overall revenue. As a percentage to GDP, tax revenue is projected to decline slightly from 12.2% in 2018 to 11.5% in 2019.
Individual income tax and companies income tax are forecast to register RM35 billion and RM70.2 billion, respectively. Indirect tax collection is projected to decline slightly to RM41.1 billion.
Export duty is forecast to remain at RM1.6 billion in tandem with assumption of stable crude oil price in the medium-term. Import duty is estimated to grow 5% to RM2.9 billion.
Meanwhile, non-tax revenue is projected to increase significantly to RM85.7 billion, primarily contributed by higher collection of interest and return on investments, of which bulk of it is dividend from Petronas amounting to RM54 billion including a special dividend of RM30 billion.
The share of petroleum-related revenue to the total revenue after excluding the special Petronas dividend is estimated to increase slightly to 19.5% in 2019.