Tobacco Tax Hike, Rigorous Enforcement Vital For Endgame 2045 – MCTC

Kuala lumpur: Increasing tobacco excise duties is among the most effective measures to curb the smoking habit, alongside comprehensive enforcement to ensure the "Endgame 2045" goal of reducing the use of smoking products can be achieved, says the Malaysian Council for Tobacco Control (MCTC). Its president, Prof Dr Murallitharan Munisamy, emphasized that tax increases are particularly effective in reducing smoking among youth and low-income groups who are more price-sensitive.

According to BERNAMA News Agency, Prof Dr Murallitharan stated that to ensure the effectiveness of price hikes and to prevent manipulation by the illicit market, comprehensive enforcement must be the primary foundation of their implementation. This fiscal measure aligns with Malaysia's commitment to the World Health Organisation Framework Convention on Tobacco Control (FCTC), signed on September 23, 2003, and ratified on September 16, 2005.

He highlighted that global studies indicate that taxation-induced price increases can reduce smoking initiation rates among adolescents, encourage existing smokers to quit, and decrease consumption among high-risk groups. MCTC also pointed out that tobacco taxes have not been raised since 2015, necessitating an urgent review of fiscal policy to meet the 2045 smoking product endgame target.

Addressing concerns that higher taxes could lead to increased smuggling, Prof Dr Murallitharan cited a World Bank report, which found that illicit trade is more closely linked to weak enforcement and governance rather than tax rates alone. Therefore, MCTC urged the government to ratify the 'Protocol to Eliminate Illicit Trade in Tobacco Products' to enhance licensing mechanisms, track-and-trace systems, and cross-border cooperation as per Article 15 of the FCTC.

Currently, tobacco product control involves several agencies, such as the National Kenaf and Tobacco Board for retail licensing, the Ministry of Health for smoking and advertising bans, and the Royal Malaysian Customs Department for duty controls and tax marking. The Solid Waste and Public Cleansing Management Corporation is also involved in waste management, including cigarette butts.

MCTC pointed out that this jurisdictional fragmentation leads to overlaps and resource constraints. Therefore, it is crucial to coordinate enforcement powers at the local authority level with a clear mandate and adequate resources. 'Without a solid enforcement foundation, the positive impact of tax increases would be eroded by the illicit market,' Prof Dr Murallitharan concluded.