KUCHING: Sarawak will join global efforts in tackling climate change with the introduction of a carbon levy in 2026.
Deputy Premier Datuk Amar Dr Sim Kui Hian said this positions the state alongside global and regional efforts in 2023-2024 to curb greenhouse gas emissions through stricter regulations, carbon pricing, and reporting frameworks.
“While Sarawak is not the first state in Malaysia to consider carbon pricing, we are the only state with a law enabling us to impose a carbon levy. This law, the Environment (Reduction of Greenhouse Gases Emission) Ordinance, 2023, was passed by our DUN members and will be enforced starting next year,” he said today.
Dr Sim pointed out that the levy falls under the Residual List, meaning all revenues will remain in Sarawak for the benefit of the state and its people.
“This demonstrates the importance of lawmakers passing substantive legislation rather than focusing on publicity stunts in the Dewan,” he said.
Citing international examples, Dr Sim said carbon taxes have generated significant revenues globally, including SGD 640 million in Singapore (2024), US$8.9 billion in France (2022), US$7.8 billion in Canada (2022), US$2.3 billion in Sweden (2022), and US$2.1 billion in Norway (2022).
At the same time, Dr Sim also drew attention to another example of Sarawak’s legislative achievements: the Sarawak State Sales Tax Ordinance 1998 (Amendment 2018), which imposed a 5 percent SST on petroleum products exported.
“Only Sabah and Sarawak have the constitutional right to this law. It is different from the federal Sales and Service Tax (SST),” he said.
He praised Premier Datuk Patinggi Abang Johari Tun Openg for his foresight in tabling the amendment in December 2018, despite opposition claims that Sarawak would go bankrupt.
“Petronas even challenged Sarawak in court, yet today, the state collects a majority of the $3.9 billion in revenue for 2025 from this law,” Dr Sim said.
He added that if distributed as a one-off cash handout, this revenue could theoretically provide $1,950 to each Sarawakian above 18 years old, but the state has prioritised infrastructure development, free tertiary education for Sarawakians in government-owned universities, and other public benefits. Sabah followed with a similar amendment in 2020.
“Both the carbon levy and the Sales Tax Ordinance amendments show the importance of our elected representatives in the Sarawak State Legislative Assembly (DUN) in passing laws that truly benefit the people.
“Let’s continue to come together, everyone playing their part for Sarawak nation-building.
“The Sarawak way could also provide a model for Malaysia’s future development,” he added.
