PUTRAJAYA could lose up to RM6 billion in tax revenue from cigarettes and vaping products due to poor enforcement against smugglers, a cigarette producer said today.

The Japan Tobacco International Bhd (JTI Malaysia) managing director Cormac O’Rourke said one in seven Malaysian smokers was using illegal cigarettes and vaping products.

He said the figures were derived from a survey JTI had conducted between March and May this year.

He said the figure could rise exponentially if left unchecked.

O’Rourke said from the RM6 billion taxes, RM5 billion will be lost to smuggled cigarettes and RM1 billion through unregulated vape products.

He said the findings from the survey – 2019 Wave Illegal Cigarette Study ICS – these smuggled products had a 70% market share.

He said last year the products controlled up to 50% of the market.

O’Rourke said the current trend was worrying as Putrajaya had increased the penalty on anyone caught smuggling tobacco products under the Customs Act in January.

JTI Malaysia communications director Azrani Rustam did not rule out the possibility that smokers were resorting to illegal smokes due to increased prices of cigarettes.

He said due to the continued trend of smokers turning to smuggled cigarettes, JTI wants a moratorium on taxes imposed on tobacco products.

“From the survey it is obvious each time taxes are increased we are forced to raise the prices of cigarettes.

“Naturally smokers will opt for cheaper alternatives,” he said.

The last time cigarette prices went up was on September 1 last year when the government implemented the sales and service tax. – August 6, 2019.