Malaysia has become the leading consumer of illicit cigarettes. Almost 60 percent of all of the cigarettes purchased are illegal.
Malaysia raised the excise duty on cigarettes to discourage smoking even so the move failed. As an alternative for smoking less, smokers selected cheaper illicit cigarettes. Thus, we earned the unenviable title of being the world’s largest consumers of illicit cigarettes, with 1,000 packs sold a minute.
58.9% Illicit Cigarette in Malaysia Market – Oxford Economics Reports
Oxford Economics estimated that 58.9% of all cigarettes offered in Malaysia last year were illegal. Another study established that for being over 12 billion sticks of illicit cigarettes sold a year ago. The illicit cigarette trade, added Oxford Economics, cost Malaysia nearly RM4.8 billion in excise taxes a year ago.
Reducing RM4.8 billion is not a laughing matter and police officers agencies have been completely conducting raids to stem smuggling operations at border checkpoints. The Customs Department confiscated contraband cigarettes worth RM1 billion for the reason that introduction of the year. Illicit cigarette smuggling is clearly among the many world’s biggest and the most profitable syndicates.
Combat Bribery & Corruption That Involved
Attempts are merely a scratch appears to it. What needed happens to be an all-out war to wipe out illicit tobacco industry. Oxford Economics reported that smuggling syndicates are undermining the rule of law and regulations in Malaysia along with spreading corruption through bribery. This could certainly lessen the country’s catch the attention of global investors.
This can be backed by reports which a staggering 80 per cent of security personnel and the police at Malaysian borders are corrupt. The sale of contraband cigarettes in Malaysia has enabled smuggling syndicates to create profits which have been channeled to finance more smuggling activities and also other types of criminal activities.
Lucrative Business For Illegal Organisation
Illicit cigarettes trade is yet another lucrative business and so forth funds are utilized to finance terrorism . The Home Ministry and crime prevention groups started drawing links to terrorist organisations and the booming illicit cigarette business, which is considered that these organisations are using Malaysia in the form of base to afford their activities.
Bribing border officials can be a small expense for smugglers, when compared with the enormous gains they earn. However, these crime syndicates also leverage threats for getting what they want. They may be brazen enough to work with whatever means important to influence officials into cooperating with them.
Poor Law Enforcement and Punishment
Cigarette smuggling has worsened within the last few years especially because present laws impose weak penalties on offenders. Poor border controls, low arrest rates also impair efforts to curb this. Malaysia’s high tobacco taxes produce a disparity in pricing between neighbouring countries. This matter is only able to be addressed along at the source. Crime syndicates are required to be tackled more seriously.
Laws needs to be brought to impose stronger penalties and punishment on anyone working in the illicit cigarette trade. Such as smugglers, distributors and even retailers. A heavy fine and mandatory jail term would have been a fitting and effective deterrent versus smuggling and selling illicit cigarettes.