KUALA LUMPUR: The additional tax claimed from Tenaga Nasional Bhd (TNB) will not be passed on to consumers through higher electricity tariffs, says the Finance Ministry.
The ministry said tariffs in the peninsula were set under the Incentive-Based Regulation (IBR) framework and required Government approval.
Under this framework, tariffs are based on the efficient and reasonable cost of supplying electricity, while changes in fuel costs are adjusted through the Automatic Fuel Adjustment (AFA) mechanism.
"Therefore, TNB's corporate tax liability is not a cost that can be automatically passed on to consumers through electricity tariffs," it said in a written parliamentary reply on Thursday (Oct 8).
The ministry said the claim also did not affect TNB's ability to pay dividends, which depended on the company's financial performance, cash position and dividend policy.
TNB declared dividends of 40 sen a share for financial year 2021, 46 sen for 2022 and 2023, 51 sen for 2024 and 53 sen for 2025.
The ministry said the additional tax claim arose from differing interpretations of the tax treatment of investment allowances claimed by the company, which the Federal Court decided on July 2, 2025.
"The claim should be seen in the context of determining the tax treatment applicable to TNB under the law, and not as an issue of TNB failing to comply with its tax obligations," it said.
It was replying to Che Mohamad Zulkifly Jusoh (PN-Besut), who asked about the impact of the claim on dividends and tariffs.
