By Khairie Hisyam
The Malaysian Quarry Association (MQA) has urged the Selangor state government to justify its need for increased government revenue from the sector following a proposal to implement a profit-sharing scheme (PSC) in the state.
Teh Quen Chang
“We think the state government has to justify,” said MQA president Teh Quen Chang in a press conference today. “If required (we) urge the Selangor state government to increase the royalties payable rather than implement a profit-sharing contract.”
This would ensure transparency and fairness in terms of state revenues generated from the quarry industry, said Teh, as well as equal application across all quarry operators.
Speaking to KiniBiz on the sidelines, Teh said the association had tried to raise its concerns to Selangor Menteri Besar Abdul Khalid Ibrahim but had been asked to refer to the state forestry department every time.
Teh had previously explained the timeline of events from January this year that saw the renewal cycle for quarry operating licences — known as minor licences — shortened drastically at the same time as the state government announced its intention in the same month to impose a PSC on quarries.
In January all quarries ceased operations for the first 19 days of the year as their licences were not renewed. They subsequently got their licences on Jan 20 but only for a one-month duration ending Jan 31 instead of the normal six-month period.
The one-monthly cycle continued until March 31 and operators were issued two-monthly licences for April and May. Notably, operators only received their licences between February and April in the middle of the month after receiving verbal permission at the start of each month.
Upon expiry of the minor licences that expired on May 31, eight operators were not granted new licences and had to stop operations.
Notably the licence issuance in mid-April was on the condition that quarries submit their costs and sales figures to the state forestry department in order for the latter to determine what percentage to take under the proposed PSC.
Failure to submit the figures would cause the department to issue a stop work order to the quarry’s activities.
Teh had earlier said that eight of MQA’s members who were not granted new licences this month had complied with the condition set by the state government to submit this information.
‘Committed to transparent royalties and taxes’
MQA’s members are committed to paying their fair share of royalties and taxes as provided for by the law, said MQA president Teh today, as they are transparent, fair and open.
The association acknowledges royalties and taxes as a relevant form of government revenue.
“Our members remain committed to this form of collection and will even support an increased royalty rate if it can be justified,” added Teh, adding that the association had continuously reaffirmed this position in all communications with the Selangor state government.
Over the past two years the Selangor state governments had actually increased royalty payments significantly, said Teh, with the Land Office upping royalties paid per tonne of material sold by 74%.
In addition the state Forestry Department had also increased its royalties by 125% in the same period, added Teh.
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