Government to stub out tobacco use by raising taxes further

14 May 2017:

TOBACCO use is one of the biggest public health threats in the world, killing about six million people annually through tobacco-related diseases. Unless urgent action is taken, it will claim an estimated eight million or more lives by 2030.

With this in mind, governments around the world are pushing for tougher anti-tobacco measures to reduce smoking prevalence.

In Malaysia, smoking-related death accounts for about 20 per cent of all deaths annually and more than 15 per cent of total hospitalisations were the result of smoking-related illnesses.

The National Health Morbidity Survey 2015 revealed that about five million or 22.8 per cent of the Malaysian population aged 15 and above were smokers.

Malaysia took the bold move of setting two goals: to reduce smoking prevalence to 15 per cent or less by 2025 and to achieve a smoke-free Malaysia (less than five per cent smoking prevalence) by 2045, as stated in the National Strategic Plan for Tobacco Control 2015-2020.

Global health experts, the Health Ministry and health economists believe that increasing tobacco tax is the way forward.

Coupled with other measures, such as plain packaging for cigarette packs, banning tobacco advertising and promotions at point-of sale as well as stringent enforcement, this could curb tobacco use.

Nevertheless, it has been argued that increasing cigarette taxes would lead to a larger illicit cigarette market, as some smokers may turn to cheaper illicit cigarettes because of higher legal cigarette prices.

Health director-general Datuk Dr Noor Hisham Abdullah dismissed the claim that a higher tax rate was the main determinant of the illicit cigarette trade, saying it was not fully supported by empirical studies.

“Increasing tobacco tax is one of the most effective interventions to reduce tobacco use. Malaysia signed the World Health Organisation (WHO) Framework Convention on Tobacco Control (FCTC) in 2003, and it was ratified and enforced in 2005.

“As a party to WHO FCTC, Malaysia is committed to achieving the set target, which is that 75 per cent of the cigarette price should constitute tax,” he told the New Sunday Times.

Dr Noor Hisham said the proposal to increase tax to curb tobacco consumption was supported by science, with studies showing that it was effective in reducing smoking consumption and prevalence.

This, he said, was evident in a study by the Health Ministry and Universiti Putra Malaysia (UPM), titled “The relationships between tobacco taxation and demand determinants to reduce cigarettes consumption and smoking prevalence in Malaysia” (2016).

Dr Noor Hisham said many countries had implemented strong tobacco tax policies, which had reduced tobacco use without leading to an increase in cigarette smuggling.

“For example, between 2000 and 2014, cigarette prices had more than doubled in the United Kingdom due to an increase in excise tax, but smoking prevalence and illicit trade decreased and tobacco excise revenues increased.

“In Malaysia, a continuous increase in the excise tax from 2012 to 2014 showed a reduction in the consumption of legal cigarettes but the consumption of illicit cigarettes remained almost at the same level.”

Dr Noor Hisham also said the reduction in smoking consumption and prevalence would reduce smoking-related diseases, which would cut the costs of treating these diseases.

In 2010, he said the government had spent some RM3 billion for the treatment of three main smoking-related diseases: coronary heart disease, lung cancer, and chronic obstructive pulmonary diseases.

He said while the Control of Tobacco Products Regulations (CTPR) 2004 regulated legal and illicit cigarettes, the main government agencies for optimising tobacco taxes and improving control on illicit cigarettes were the Finance Ministry and Customs Department.

“The Customs Department has made tremendous effort and is looking to strengthen control of illicit cigarettes, such as smuggling, distribution and sales activities.

“Besides reinforcing border control, other tobacco-control measures must also be strengthened to produce an overall effect.”

Dr Noor Hisham acknowledged that the government always faced challenges in implementing policies concerning tobacco control, including “industry interference, either globally or locally”.

Other challenges included limited resources for tobacco control activities, including financial and human resources, and the introduction of new tobacco products, such as electronic cigarettes and shisha.

“These new products may infer a perception of ‘safety’ for using tobacco products. We are also working on de-normalising the smoking culture in Malaysia to instil no-smoking as the lifestyle choice into adults and youth.

“Agencies should not look at tobacco products as a normal trade product but instead recognise it as an inferior good that causes premature deaths.”

Deputy Health Minister Datuk Seri Dr Hilmi Yahaya had, in March, announced plans to increase cigarette prices from RM17 to RM21.50 a packet to deter smoking among Malaysians, especially youth.