Malaysia to Tax E-Cigs and Vapor Products at 10%

Malaysia will implement an excise duty at an ad valorem rate of 10 percent on all types of vapor and e-cigarette products. Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz says the tax includes all types of electronic and non-electronic cigarette devices, including e-liquids.

“Electronic cigarettes liquid too will be subjected to an excise duty at a rate of .40 sen (cents) per millimeter,” he said during the tabling of the Budget 2021 in parliament today. The tax takes effect on Jan. 1, 2021.

Tengku Zafrul said taxes would be imposed on cigarettes and tobacco products on all duty-free islands and any free zones that have been permitted retail sales of duty free cigarettes, according to a story on thestar.com. He added that the issuance of new cigarette import licenses would also be frozen.

He said that the transhipment of cigarettes activities to selected ports would also be limited.

“We will impose taxes on drawbacks on all imported cigarettes for the purpose of transhipment and re-exports,” he said, adding that transhipment activities and re-exports of cigarettes using pump boats would also not be allowed.