KUALA LUMPUR: Petroleum-related revenue is expected to register a lower collection of RM62 billion, accounting for 18.3 per cent of the federal government’s total revenue in 2025.
The Finance Ministry (MoF) said the revenue is expected to contribute three per cent of gross domestic product (GDP) in 2025, with Petroliam Nasional Bhd (Petronas) dividends making up more than half of the total.
In contrast, non-petroleum revenue is projected to increase 7.2 per cent to RM277.7 billion, reflecting better revenue diversification on the back of a favourable economic outlook, the MoF said in its 2025 Fiscal Outlook and Federal Government Revenue Estimates report released today.
The ministry said that the share of petroleum-related revenue is also forecast to be lower in 2024 at 19.6 per cent of the total revenue, contributing 3.2 per cent of GDP.
It said non-petroleum revenue is projected to improve 8.3 per cent to RM259 billion, anchored by better collection from tax revenue, reflecting revenue diversification efforts as well as positive economic outlook.
“The government will continue to ensure sustainable non-petroleum revenue generation to meet expenditure commitments, particularly to serve the needs of the rakyat,” it said.
Non-tax Revenue
For 2025, the MoF said, non-tax revenue is estimated to decline 0.4 per cent to RM80.7 billion, primarily due to lower proceeds from investment income.
Non-tax revenue is estimated to decline to RM81 billion this year, mainly due to lower investment income, particularly dividends from Petronas amounting to RM32 billion, reflecting lower reliance on petroleum-related revenue.
“Annual dividends in 2025 are expected mainly from Petronas (RM32 billion), Bank Negara Malaysia (BNM) (RM4 billion) and Khazanah Nasional Bhd (RM2 billion),” it said, adding that RM4 billion is anticipated from the Retirement Fund (Incorporated) (KWAP) to partly finance the retirement charges.
It said collection from licences and permits is projected to increase slightly to RM16.7 billion in 2025, contributed by higher proceeds from levy on foreign workers at RM3.7 billion and motor vehicle licences at RM3.4 billion.
“Receipts from licences and permits are expected to decline slightly to RM16.5 billion in 2024, mainly due to lower proceeds from petroleum royalty,” it said.
Nonetheless, the MoF said several components of non-tax revenue are projected to increase, cushioning the impact of lower Petronas dividend receipts in 2024.
For instance, it said, the government has received dividend from BNM amounting to RM2.85 billion, while RM1 billion is expected to be received from Khazanah in 2024.
The MoF said the government is also expected to receive proceeds from asset recovery measures amounting to RM2.3 billion and unclaimed monies estimated at RM2 billion, following the enhancement of the Unclaimed Monies Act 1965 [Act 370].
In addition, KWAP is expected to contribute RM3 billion to partly finance the current year’s retirement charges, it said.
“Motor vehicle licences collection is forecast to be stable at RM3.3 billion, in tandem with sales hike in passenger vehicles. Similarly, the levy on foreign workers is estimated to remain at RM3.7 billion (in 2024),” it added.
