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Malaysia: The Local E-Cig Industry is Too Big to Remain Unregulated

Valued at an estimated RM2.7 billion, the local vape industry is too substantial to remain unregulated, said the Malaysian Vape Chamber of Commerce (MVCC).

Diane Caruana

June 24, 2021

Regulating e-cigarettes would have a positive effect on the local economy by creating more jobs and attracting foreign direct investment.

The MVCC is calling onto Malaysia’s government to set in place appropriate regulations on nicotine-containing e-liquids. They highlight that amongst other things this move would have a positive effect on the local economy by creating more jobs and attracting foreign direct investment (FDI).

“The findings show that there are more than 3,300 businesses related directly to the vape industry, with a workforce of more than 15,000 workers,” said the MVCC, on launching its Malaysian Vaping Industry report.

MVCC president Syed Azaudin Syed Ahmad, said that the report findings strongly indicated that the sector was a viable and growing industry in Malaysia, and that it has facilitated the growth of local entrepreneurs. “In addition, the Malaysian vape industry currently has an established ecosystem comprising manufacturers, importers and retailers, and a growing distribution and logistics network,” he said.

Excise tax on vape and tobacco products

Last year, the Malaysian government had announced an excise tax on vape devices and e-liquids. However, reiterating the need for regulations, Health director-general of Malaysia Tan Sri Dr Noor Hisham Abdullah, had said that before setting in place any taxes on e-cigarettes, proper regulations were required.

The excise tax on all tobacco products and electronic/vaping products, has now gone into effect, at a 10% rate of the value of the products and one of 40 sen per ml on e-liquids. The taxes have also been imposed on cigarettes and tobacco products on all retail zones and outlets that sell duty free cigarettes. Moreover, the issuance of new cigarette licences has been frozen, whilst new restrictions on the licensing process are in the works.