Govt loses RM6 billion annually through illegal cigarettes, vaping

Japan Tobacco International Bhd (JTI Malaysia) has urged the government to take stern action against the illegal cigarettes and vaping trade as it has resulted in an annual RM6 billion tax revenue loss.

Its managing director Cormac O'Rourke revealed that illegal vaping had increased by more than double from 2018 and along with illegal cigarettes, the black market trade now accounts for approximately 70 per cent of the total consumption in Malaysia.

“This is very concerning when you consider the extent of losses to the government. When you factor in illegal vaping and illegal cigarettes, the government is expected to lose RM6 billion annually in tax revenues,” he said in a media briefing on the black market trade here yesterday.

As Malaysia tops the world with the highest penetration of illicit cigarettes, which stands at 63 per cent currently, followed by Uganda (57 per cent) and Brazil (54 per cent), O'Rourke said the government must play a crucial role to tackle the issue.

For the vaping industry, he pointed out that laws have been in place through the Poisons Act 1952 to regulate all products containing nicotine.

As such, O'Rourke suggested for the Poisons Act 1952 to be amended to reflect the new realities of the market place and to ensure that Malaysian consumers have access to reduced risk products that adhere to regulatory framework fit for its purpose.

“The fact is that no licences have been issued by the Health Ministry for nicotinecontaining vaping products in the country, (but) yet, reputable online platforms and brick and mortar stores are selling these products openly. This is another example of enforcement failure,” he said.

Health Minister Datuk Seri Dr Dzulkefly Ahmad on July 28 said the government will draw up a new act to supervise the usage of tobacco, vape, electronic cigarettes and shisha.

He said the ministry is formulating the act, to be named the Tobacco Act, to tackle the whole problem comprehensively. - Bernama