Sarawak to raise tax on hill timber by more than 6,000%


KUCHING: The Sarawak government is to raise the hill timber premium by more than 6,000% from the current RM0.80 to RM50 per metric metre of logs harvested, effective July 1.

The new rate for the hill timber premium will affect all hill logs, including logs of hill species from agri-conversion areas and Yayasan Sarawak concession areas.

The beneficiary of the taxes will continue to be the Sarawak Education Fund, of which Yayasan Sarawak is the secretariat.

“It has not been reviewed in the last 30 over years,” state assistant minister for environment Len Talif Salleh told reporters here today in justifying the tax increase.

“At the same time, we want to send a message to them that production from the (primary) forests will be reduced,” he added, referring to timber firms.

Added revenue from the raised premium would be up to RM300 million annually, said Len Talif.

Last month, The Borneo Post reported a circular dated April 12 issued by State Forestry director Sapuan Ahmad that the chargeable premium for hill timber logs would be raised.

The circular titled “New Rate of Hill Timber Premium (Sarawak Foundation Fund)” stated that “Chief Minister/Minister of Resource Planning and Environment, in accordance with Section 46 (1) of the Forest Ordinance, 2015, has approved the increase in the rate of Hill Timber Premium, that is premium chargeable on all species of logs harvested from hill forests and logs of hill species from agri-conversion areas”.

The current rate of the hill timber premium for all hill logs is RM0.80 per cubic metre and logs of hill species from agri-conversion areas is RM3 per cubic metre, The Borneo Post reported.

The collection has been enforced since 1984.

Len Talif said that hill logging may not be sustainable with re-plantation behind schedule.

“The area that has been planted by them has been so much behind time.

“Of the 300,000ha, half of that has been planted by the government. So only 150,000ha has been planted by the private sector’s licensed holders,” he said.

Due to the environmental unsustainability, Len Talif also said the state government may impose an eventual halt in logging exports.

“With this initiative, I think they get the message that they have to do the planting if they want to survive in the industry. We want to do a review of how far into the future we want to begin banning logging exports,” he said.

In Sarawak, about five million hectares of forest have been set aside for timber production, according to government data.

The six largest timber firms hold about 3.7 million hectares (or 9.2 million acres) of timber concessions. Sarawak’s total land mass is 12.4 million hectares, close to that of Peninsular Malaysia’s.