Prime Minister, Datuk Seri Anwar Ibrahim announced that the government is currently examining a proposal to increase the tobacco tax rate.
The tax rate was last increased in September 2014 with economists previously suggesting that it be increased to 60 to 75%.
Anwar stressed that the effort is in line with the government’s commitment to public health and national revenue reform as the tax rate has not been reviewed for a long time.
Through the 13th Malaysia Plan (13MP) last week, Anwar also announced the expansion of pro-health taxes from only sugary products to tobacco, electronic cigarettes and alcohol.
The tax expansion is not only aimed at increasing the country’s revenue but also inducing changes in people’s behavior and curbing the increase in non-communicable diseases (NCDs).
The statement was made when he was asked whether the government was considering increasing tobacco taxes in the 2026 Budget Presentation scheduled for this October.
To date, tobacco taxes in Malaysia cover 58.6% of the retail price and there is no fixed procedure for periodic adjustments or assessments to be implemented.
