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High Cigarettes Prices in MalaysiaBecause of the large number of anti-tobacco legislations and cigarettes tax increase, in many states cigarettes started to be selling illegal. Researchers found that contraband cigarettes have become the main problem in Malaysia because of high cigarette prices and low penalties. But the Government is losing almost RM1.5bil in revenue annually. Moreover, the unlawful market has opened a major industry which gives syndicates working smuggling networks up to RM1bil in profits annual. It also overcomes the Government’s move to increase prices for to discourage smoking among the minors and adults. A recent study showed that illegal cigarettes are quite easily got at markets in Malaysia. Most of those who smoke these cigs appear to come from the lower income group as these cigarettes are available for as low as RM2.50 for a pack of 20. But legal cigarettes cost between RM6.40 and RM9.30 for a pack of 20. Researchers explained that the illicit market now accounts for more than one out of three cigarettes sold. About 38.7% of the Tobacco industry by volume is now illicit, up from 27.5% in 2008, they added. This means that out of the 23.3 billion cigarettes consumed in 2009, approximately nine billion sticks were illicit. The legal market has also shrunk by 10% compared with 2008 to an estimated 13.8 billion. In our days, Malaysia is one of the countries with the highest taxes for cigarettes after Singapore. But illegal syndicates are taking advantage of this and making a cool RM1bil a year from the Government’s position to stamp out cigarettes smoking. "Excessively high taxation is a main contributor to the rise in the trade of illicit cigarettes in Malaysia," said JT International Bhd director of collective affairs and communications Shareen Rahmat. British American Tobacco Malaysia Bhd (BAT) head of business development Azlan Ibrahim explained that most of the smuggling was from neighboring countries such as Thailand, Indonesia, Cambodia and China. "Right now, these illegal smoking products enter Malaysia through overland routes via Thailand and Singapore, sea routes from Indonesia, and smuggling through ports," added Azlan. |
