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Malaysia’s court rules federal government illegally withheld Sabah’s 40% revenue share since 1974, ordering repayment within 180 days.
On October 17, 2025, the Kota Kinabalu High Court ruled that Malaysia’s federal government unlawfully withheld Sabah’s constitutionally mandated 40% share of federal revenue since 1974, declaring special grant arrangements used instead as invalid and unconstitutional.
The court ordered a review and settlement of arrears within 180 days, affirming Sabah’s rights under the Malaysia Agreement 1963.
Legal and political leaders, including the Sabah Law Society and Upko, urged the federal government not to appeal, calling the decision a landmark victory for federalism and constitutional integrity.
The ruling is expected to influence fiscal relations and political dynamics ahead of Sabah’s November 29 state election.
La corte de Malasia dictamina que el gobierno federal ha retenido ilegalmente el 40% de la participación en los ingresos de Sabah desde 1974, ordenando el reembolso dentro de 180 días.