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flag Malaysia’s court rules federal government illegally withheld Sabah’s 40% revenue share since 1974, ordering repayment within 180 days.

flag 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. flag The court ordered a review and settlement of arrears within 180 days, affirming Sabah’s rights under the Malaysia Agreement 1963. flag 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. flag The ruling is expected to influence fiscal relations and political dynamics ahead of Sabah’s November 29 state election.

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