Labuan to keep duty-free status

LABUAN: Labuan will keep its duty-free status despite the Government losing revenue in uncollected taxes due to the smuggling of cigarettes and other contraband from the island, said Datuk Seri Najib Tun Razak.

The Prime Minister said the Government did not want to penalise the people of Labuan for the rampant smuggling activities which he said were carried out by syndicates.

He said enforcement agencies would instead be directed to keep a close watch on outlets on the island selling contraband goods to stop the leakages.

Najib said it had been estimated that the Government was losing as much as RM1bil a year due to the smuggling of duty-free goods from Labuan and Langkawi.

Launching the Labuan Urban Transformation Centre (UTC) yesterday, he said the Federal Government was aware of the tougher economic times on the island due to its dependance on the oil and gas industry that was experiencing a drop in the prices of the commodity.

He said the current low oil and gas prices was part of a cycle and as such the situation would eventually improve.

“We will weather this situation together and the Government will do what it can for Labuan. We have gone through worse,” Najib added.

He said although Malaysia was impacted by the decline in oil and gas prices, the country remained economically resilient due to the Government’s prudent policies.

“So no matter how tough the challenges we face, we will pull through,” Najib said.

On the Labuan UTC, Najib said he was happy to learn that it was not only benefiting the islanders but also Sabahans living in Menumbok and Kuala Penyu as well as Sarawakians from nearby Lawas.

The Prime Minister said the Labuan UTC and those throughout the country was part of his “1Malaysia, People First, Perfor¬mance Now” pledge.

“If you tell a foreigner that you can get medical or dental treatment at a UTC for US$0.25 (RM1) they will only shake their heads in disbelief. But that is a fact and it is because this is a Government that cares,” he added.

The Labuan UTC located at the island’s Pasar Sentral was built at a cost of RM23mil and completed in eight weeks.

Later when launching the Federal Territory Day celebrations here, Najib said the island’s tourism potential would be further developed while both public and private institutions of higher learning would be encouraged.

In this regard, he said the nearby islands of Pulau Papan, Burung, Rusukan Kecil and Rusukan Besar had much potential for tourism activities.

He said the Government would also encourage further development of Labuan as a logistics hub.

A new ferry terminal costing some RM200mil would be built to shorten the travel time between Labuan and Menumbok in Sabah as part of measures to develop the island’s tourism sector, he added.

He said as an interim measure, an additional ramp would be built at the existing ferry terminal to speed up the embarkation and disembarkation process of vehicles.

Najib said the Government would also build more than 3,000 units of affordable housing at seven locations around Labuan for the benefit of islanders.

He said to help small-scale entrepreneurs, the Government had also reduced rentals for lots at the central market from RM300 to RM100 until June this year.