Business Group Says Proposed Smoking Ban Is Impulsive & Will Drive People To Black Market

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The Malaysian International Chamber of Commerce and Industry (MICCI) said that while it supports the Ministry of Health's (MOH) efforts to curb the high smoking rate, it cannot accept the "arbitrary setting of policies and regulations" without due consultations and science-based decision making.

Calling Health Minister Khairy Jamaluddin's announcement about Malaysia's plan to ban the sale of cigarettes and tobacco products a "knee-jerk decision", the business group warned that it may "backfire" and will instead drive people, regardless of their age, to unregulated hazardous black-market sources.

"It can set a slippery slope precedent affecting other sectors as well," it said in a statement.

According to MICCI, the implementation of policies that are not well-thought-out can lead to inconsistent enforcement and send a wrong message to the investment and business community.

"This move will also create an uncontrollable black market for cigarettes and vape. These illicit and uncontrolled harmful products and ingredients are the 'elephant in the room' that the government should address."

The introduction of high excise duties instead created an environment where six out of every ten packs of cigarettes sold in Malaysia are illegal, according to the business group's executive director Shaun E Cheah.

"This shows that the high excise duties did not achieve their objective of discouraging Malaysians to smoke. Now, the MOH has chosen to introduce yet another measure that will drive future adult consumers towards black market products," Shaun said, adding that Malaysia's tobacco black market currently commands a 57% share of the total tobacco market.

According to Japan Tobacco International Berhad (JTI Malaysia) managing director Cormac O'Rourke, Malaysia remains the number one country in the world for the illegal cigarette trade.

"This is not good news," he was quoted saying in an October 2020 report.

"Multiple international studies have shown that no-burn (non-combusted cigarettes) or vape is significantly less harmful," it said, noting that even New Zealand, which MOH is proposing to emulate, embraced and encouraged alternative products before announcing their cohort ban on smoking in the country.

MICCI argued that by introducing comprehensive complementary harm-reduction regulations, MOH could protect the health of Malaysians, as well as allow local businesses to continue contributing excise duties.

"MICCI believes in a serious harm reduction stance to address the sale of illegal tobacco products and unregulated vape as an initial step instead," the group emphasised in the statement.

It said that MOH's intended measure is "missing the wood for the trees" with undue attention to "an already legitimate, heavily regulated tax revenue-generating industry".