KOTA KINABALU, May 24 — Sabah will enhance its tax collection system to close loopholes and target evasion that were costing the state government millions in revenue, said Datuk Masidi Manjun.

The Sabah finance minister said the state would expand its tax collection unit, as well as continue to work with other agencies like the Malaysian Anti-Corruption Commission (MACC) and the Malaysian Palm Oil Board (MPOB).

"Our tax collection system is a bit lacking, especially because we are talking about billions, and we need to be beefed up. We are looking at working with other agencies for those who are under-declaring their income, and it is a significant amount,” he said.

He said that palm oil companies, for instance, would give different numbers than provided to the MPOB and this discrepancy would be discovered after further inspection.

He said that they would be increasing staff for their tax collection unit to be able to do a thorough job of auditing companies in order to track everything that the government is owed.

Masidi, who was speaking during the state assembly sitting today, said many large oil palm estates in Sabah were owned by public-listed companies, yet the state did not benefit from their income from their palm oil estates.

"They are big companies who are listed on the Kuala Lumpur Stock Exchange. But what are they paying us? The income tax is declared and paid in Kuala Lumpur so we can’t do anything,” he said.

He said that the ministry issued five notices of assessment involving some RM53.36 million to companies said to have under-declared their tax returns.

"So far, only RM4 million of these taxes have been paid. But we have a scheme to allow those who under-declared in order to pay less,” he said.

Moyog assemblyman Datuk Darell Leiking then suggested that the vigilance also be extended to other industries to deal with the loss of revenue for the state.