Putrajaya mulls introduction of carbon tax

KUCHING: The federal government is looking into introducing emissions trading systems (ETS) and carbon taxes to reduce greenhouse gases, supporting the country in transitioning to a green economy.
Sarawak Deputy Secretary (Economic Planning and Development) Datuk Dr Muhammad Abdullah Zaidel said it would be similar to the carbon tax implemented in Singapore in 2019 – which was also the first carbon pricing scheme in Southeast Asia.
This, he said, will encourage businesses and industries which emit carbon dioxide or greenhouse gases – on social responsibility towards protecting the environment.
“The federal government is currently looking into the possibility of introducing a carbon tax – like the one in Singapore.
“I believe and hope that Malaysia will follow suit because (I had been informed that) they are engaging the World Bank to study the matter,” he told reporters after attending the ‘Propelling Malaysia Forward 2023: Sarawak Series’ conference held here Monday.
All the governments in the region, Abdullah said, should introduce carbon tax – at a same rate – to accelerate decarbonisation efforts, pointing out this will enhance the business case for the development of low-carbon solutions.
“I think this is relevant and timely as a way to encourage more companies to look into issues regarding climate change and environmental degradation, otherwise, things will be moving very slowly (in carbon trading),” he said.
He added that the Sarawak government had amended the Sarawak Land Code and Forest Ordinance last year, to facilitate the development of the new economy such as the carbon capture, utilisation and storage (CCUS).
“This will attract investors to Sarawak as they know that there is proper legislation here where their interests will be protected by law,” he said.
Meanwhile, Bursa Malaysia Berhad chairman Tan Sri Abdul Wahid Omar hoped more Malaysian businesses would become a part of the voluntary carbon market ecosystem since the launch of the Bursa Carbon Exchange last year.
Also present at the press conference was President & Group Chief Executive Officer of Affin Bank Berhad, Datuk Wan Razly Abdullah
According to the National Climate Change Secretariat (NCCS), Singapore implemented the carbon tax in 2019 where the level was set at S$5/tCO2e for the first five years from 2019 to 2023 to provide a transitional period for emitters to adjust.
It will be raised to S$25/tCO2e in 2024 and 2025, and S$45/tCO2e in 2026 and 2027, with a view to reaching S$50-80/tCO2e by 2030; to strengthen the price signal and impetus for businesses and individuals to reduce their carbon footprint in line with national climate goals.