Local liquor manufacturers cry foul over new ruling

KUALA LUMPUR: Local liquor manufacturers and bottlers are in a lurch, with millions of ringgit worth of unsaleable liquor products following the Health Ministry’s Oct 16 announcement that only local liquor bottled in 700ml volume can be sold.

Malaysia Liquor Manufacturer and Bottler Association ( MLMBA) president Kristine Goh said with no grace period to clear their products for which excise duty had already been paid, local producers felt they were being unfairly targeted.

This follows a rash of alcohol poisoning incidents with over 40 deaths in September, where the victims were found to have drunk compounded hard liquor adulterated with methanol.

Goh said the Health Ministry’s amendments to its Food Regulations 1985 targeted only local liquor products, leaving imported wines and spirits, as well as high-strength pre-mixes and ready-to-drink beverages untouched.

“Our local liquor products are actually quite small, we only make up about 2% of the RM13bil Malaysian market,” she said, adding that local liquor was only permitted for sale in 3,000 licensed outlets, out of 80,000 such places nationwide.

Goh also pointed out that local liquor producers contributed up to RM80mil in taxes per annum, and this would suffer, as it already did back in 2016, where the imposition of 150% tax increase caused a 60% drop in sales immediately.

“We understand that the government is working to protect consumers, but we feel we are being made scapegoats in a knee-jerk reaction, despite our clean record and compliance with all the regulations,” said Goh.

When asked why producers could not just rebottle the smaller volumes to comply with the 700ml ministry limit, Goh explained that excise duty had already been paid for each bottle the moment it was produced.

“To rebottle them we would have to pay more excise duty, and we cannot recover our production costs.”

MLMBA secretary-general Shanmuganathan Arumugam added that the term “compounded hard liquor” was not an industry term for what was essentially blended liquors, including locally produced whiskies.