‘PRICE HIKE WON’T AFFECT SMOKERS’
Cigarette black market stands at record 57.1 per cent
FURTHER increases in cigarette prices will have no effect on smokers as they will turn to cheap and readily available illegal cigarettes which are abundant in the black market.
The Confederation of Malaysian Tobacco Manufacturers (CMTM) warned that the impression that smokers would quit if cigarettes were too expensive ignored the fact that there were cheaper alternatives available.
“The cigarette black market stands at new record high of 57.1 per cent, based on the latest Illicit Cigarette Study conducted by Nielsen Malaysia in December last year.
“This is one of the highest rates in the world, demonstrating that the illegal market is something that cannot be ignored,” it said yesterday.
This came as a response to government announcements this week that cigarette prices would be increased to deter the unhealthy habit among Malaysians.
CMTM questioned the rationale behind increasing the price of cigarettes to RM21.50 a pack, when there were hundreds of unregulated illegal cigarette brands costing between RM3 and RM5 a pack.
Reports by the Health Ministry, it said, indicated that between 2011 and 2015, the number of smokers had increased.
According to the ministry’s Global Adult Tobacco Survey (GATS) 2011, the number of smokers in the country stood at 4.75 million.
“Subsequently, the ministry’s “National Health and Morbidity Survey (NHMS) 2015 — Reports on Smoking Status among Malaysian Adults” reported that the number of smokers had increased to five million while cigarette prices during the same period of time increased by more than 30 per cent.
“If cigarette price increases did have a correlation to smoking cessation, the percentage of smokers would have dropped.”
When more than one in two packs was illegal and sold so cheaply, it said, increasing the prices of legal cigarettes would only reduce government revenue collection.
The ones profiting from another round of price increases would be traders reaping huge profits from the illegal activity.
This resulted in losses of approximately RM4 billion in government revenue collection, as reported by the Customs Department last year.
“Statistics from the Tobacco and E-Cigarette Survey released by the ministry recently reported that about 71.6 per cent of adolescents who smoked in Malaysia spent less than RM9 for a pack of cigarettes, which is below the minimum cigarette price threshold of RM10.
“This makes illegal cigarettes the key contributor for adolescents to start smoking, given the easy accessibility and cheap price factor.”
CMTM said if the ministry was serious about reducing smoking in Malaysia, combating cheap illegal cigarettes should be their number one priority.
“CMTM believes this issue needs to be made a national priority requiring concerted efforts from all enforcement agencies in a holistic approach in tax policy.
“All enforcement agencies, including the Health Ministry, should work together with the Customs Department to fight the trade in illegal cigarettes,” it said, adding that a moratorium on cigarette excise was necessary.
To reduce smoking in Malaysia, combating cheap illegal cigarettes should be the number one priority.