DIVIDENDS from PETRONAS are estimated to account for only 5 to 6% of the Federal Government’s revenue this year, according to the Finance Ministry.
“The Federal Government’s revenue for 2026 is projected at RM343.1bil, comprising RM270.4bil in tax and RM72.7bil in non-tax revenue.
“Of this, the projected RM20bil dividend from PETRONAS for 2026 is included under non-tax revenue,” it stated in a written parliamentary reply.
The ministry said federal fiscal management comprised not only revenue but also expenditure, borrowing, debt and fiscal risk management.
From the revenue perspective, it said tax remained the government’s principal source of income, accounting for more than 70% of total federal revenue.
The ministry said the government remained committed to reducing its reliance on petroleum-related revenue due to the volatility in global crude oil prices.
“Petroleum-related revenue accounted for the highest proportion of total government revenue at 41.3% in 2009. Through the revenue measures implemented since 2023, the share of petroleum-related revenue was reduced to 17.5% in 2025, compared with 28% in 2022.
“Furthermore, petroleum-related revenue is projected to decline further to 12.5% in 2026,” it said.
The ministry said Putrajaya has formulated the Medium-Term Revenue Strategy (MTRS), which will be implemented progressively, with the government also focusing on broadening the tax base and improving tax administration.
These included digitalising tax administration, expanding the scope of the Sales and Service Tax (SST), raising the service tax rate from 6% to 8%, and revising sales tax rates alongside a broader service tax scope starting on July 1 2025.
“Fiscal management is not confined to just revenue reforms. The government is also implementing a range of economic policies under the Madani Economy framework to further stimulate economic growth.”
