KUALA LUMPUR — Claims that the federal government is unfairly sidelining certain states are unfounded, as all states receive higher federal allocations than the tax revenue they generate, said Prime Minister Datuk Seri Anwar Ibrahim.
In a detailed reply in the Dewan Rakyat, Anwar said the situation in Sarawak, Malaysia reflected what he described as a historic milestone in federal-state relations, including negotiations that recognised constitutional rights over key assets such as ports.
During the Prime Minister’s Question Time (PMQT) in Parliament, Anwar said Sarawak had, as part of an agreement, made an unprecedented RM1.8 billion cash payment to the federal government.
“This is the first time in history that a state government has handed over a cash cheque to the federal government,” he said, adding that it demonstrated the importance of conducting negotiations in a constructive manner.
Anwar said accusations raised in Parliament suggesting injustice or neglect did not reflect the reality of federal spending, adding that he had detailed all state allocations to clarify the matter.
He said all states received higher federal allocations compared with their average tax contributions, with the exception of Selangor and Penang, Malaysia due to their stronger revenue base.
He noted that Selangor recorded average federal revenue of RM43.6 billion between 2023 and 2025, while federal spending in the state stood at RM15 billion over the same period.
For Penang, he said federal revenue amounted to RM10.7 billion, compared with RM7.9 billion in federal expenditure.
Anwar stressed that these figures contradicted claims that Penang received disproportionately higher allocations.
He added that the federal government continues to prioritise states requiring urgent development, particularly in flood mitigation, road upgrades including the Pan Borneo Highway, drainage systems and infrastructure improvements.
He also provided breakdowns for several states, including Kelantan, Malaysia, which recorded average revenue of RM946 million between 2023 and 2025 against federal expenditure of RM8.9 billion.
For Kedah, Malaysia, he said revenue stood at RM3.7 billion, while federal spending reached RM9.5 billion.
He further noted that Terengganu, Malaysia generated RM1.2 billion in revenue, with an additional RM1.2 billion from oil-related returns, bringing total revenue to RM2.4 billion, against RM7.8 billion in federal expenditure.
For Perlis, Malaysia, he said revenue was RM419 million, while federal spending reached RM2.2 billion.
He added that Johor, Malaysia recorded RM14 billion in revenue against RM16 billion in federal expenditure.
Anwar said additional allocations had also been channelled through mechanisms such as ecological fiscal transfers, capitation grants and other development funds announced to state leaders.
He reiterated that the Madani government had provided the highest allocations to states such as Kedah, Terengganu and Kelantan compared with previous administrations.
“I hope this explanation helps to dispel unfounded allegations and fitnah,” he said. – June 30, 2026