KUALA LUMPUR: State governments owe the Federal Government over RM17bil said Finance Minister Lim Guan Eng (pic).
"As of April this year, the 13 state governments owe the Federal Government a total of RM17.64bil.
"Of this, Pahang has the highest debt totalling RM3.12bil while Penang has the lowest debt totalling RM60.2mil," he said when replying to a question raised by Datuk Seri Mukhriz Mahathir (PH-Jerlun) in the Dewan Rakyat on Wednesday (July 18).
He said that the Federal Government had distributed RM6.9bil to state governments last year for road maintenance work and to cover shortfalls in their management accounts.
"RM54.7mil was given to Kelantan and RM38.4mil to Perlis," he added.
To a suggestion by Muhkriz that a review be done to the archaic laws on finance distribution to the states, Lim said that his ministry was open to proposals.
However, he noted that the ministry's focus was on dealing with the nation's fiscal deficit brought about by uncontrolled spending and corruption by the previous administration.
A brief war of words erupted between Lim and Datuk Seri Dr Ismail Mohamed Said (BN-Kuala Krau) when the latter asked if the Federal Government would allow state governments to collect their own taxes such as was proposed by Penang when challenging the Good and Services Tax (GST).
Lim then suggested to Dr Ismail to submit his proposal to his ministry, prompting Datuk Shamsul Anuar Nasarah (BN-Lenggong) to say: "Alamak, jawapan standard menteri (Oh no, a typical Minister's reply)".
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