Malaysia mulls excise tax on nicotine products for vaping

24 February 2023

By Wartawan Nabalu News

KUALA LUMPUR: The Malaysian government is considering imposing an excise tax on liquid or gel products that contain nicotine and are used for vaping and electronic cigarettes.

Prime Minister Datuk Seri Anwar Ibrahim stated that this measure is necessary to reduce the use of vaping, despite the fact that nicotine-containing vapes are still illegal under Malaysian law.

However, these products are widely sold and are estimated to be worth over RM2 billion.

The government supports the Generational Endgame (GEG) initiative and plans to allocate half of the revenue generated from this excise duty to the Ministry of Health.

This allocation will aid in improving healthcare services, including effective anti-smoking and anti-drug campaigns.

Datuk Seri Anwar Ibrahim announced these plans while presenting the 2023 Budget in the Dewan Rakyat.

To reduce wastage, the government will intensify joint enforcement efforts with industry players and government agencies to curb the wastage of revenue and subsidies caused by smuggling syndicates dealing in diesel, alcohol, and cigarettes.

The Inland Revenue Board (LHDN) and the Royal Malaysian Customs Department will reintroduce voluntary disclosure programmes.