PUTRAJAYA should reconsider the tax on vape devices and liquids in light of the bad economy during Covid-19 pandemic and other health concerns, too, said industry players.

According to them, the tax to be imposed on January 1 will be stifling and would pave the way to a contraband market amid the pandemic where the economy is already reeling.

The government will enforce an excise duty of 10% on devices for all e-cigarettes and non-e-cigarette products, including vape liquids, which will be charged 40 sen per ml. This also includes vape liquids with no added nicotine.

Malaysian Organisation of Vape Entities (MOVE) president Samsul Kamal Ariffin said the tax is detrimental to Malaysians in light of the pandemic.

“This is a drastic measure that will paralyse the vape industry as well as cripple a lot of local industry players in 2021 against a bad economy,” he told The Malaysian Insight.

Samsul agrees that regulation is necessary for the vape industry as it legitimises the field but the hefty introductory tax is detrimental to many vape users and entrepreneurs.

“We want to be regulated. We are not against that. We know when there is regulation, there is going to be a tax but we ask what is the hurry?

“Why do they want to impose a tax without even discussing with the stakeholders first?”

Samsul said the government’s cut-off for registration of vape entities is December 15 with the implementation coming to effect on January 1, barely 15 days after the period ends.

It is also painful for vape producers where they will be taxed for non-tobacco liquids which contain the same ingredients found in pastries, he said.

“The tax is also for zero-nicotine liquid, which is basically the same ingredients you can find in cakes or ice-creams.

“We do not understand why this tax is imposed on non-controlled items and the tax is the same amount imposed on cigarettes. It is baffling.”

MOVE has launched an online campaign urging the government to repeal the vape tax. More than 10,000 people have signed it since it was initiated three weeks ago.

Malaysia Retail Electronic Cigarette Association (MRECA) president Adzwan Ab Manas predicts the government will make around RM300 million next year alone from the vape industry taxes.

Most retailers have agreed to the tax as it would legitimise and level the playing field but want more regulations and study before the tax is implemented, said Adzwan.

“Industry players have agreed over the tax but it should be a reasonable amount. Forty sen per ml is very high, we propose 10 sen per ml first, then we can take it stage by stage.

“They should understand the plight of the country, it is as though they want to kill the vape industry,” Adzwan told The Malaysian Insight.

Taxing zero-nicotine liquids would also get more people to brew illegal vape liquids and also introduce “nicotine shots”, which is a phenomenon in Europe already.

“If there is zero nicotine, it will encourage more people to try. It will target kids and those who have not smoked before. If there is nicotine added, only smokers or those who would want to quit will be the ones trying it.

“The black market for this will increase and there will be those also who will try adding nicotine themselves,” Adzwan said.

Samsul agrees and said this would lead to nicotine shots being handled loosely, which in the wrong hands could lead to nicotine poisoning.

“Nicotine shots are only supposed to be handled by trained pharmaceutical operators. What this would do, vape retailers will be selling the shots under the table for people to mix it themselves in the zero-nicotine liquid.

“If it is not mixed properly, it will lead to nicotine poisoning and possibly death.”

Follow UK model

According to Universiti Kebangsaan Malaysia’s Dr Sharifa Ezat Wan Puteh, it is good to impose tax on vape products as it will give official recognition and lead to better enforcement but this will also deter people from quitting cigarettes as a whole.

“Once you tax the e-cigarettes, they might feel cumbersome as it now costs more money. They might reduce vaping and might go on to transitioning back to tobacco, as they would feel contraband cigarettes are cheaper.

“There will also be people who will sell products in a non-regulatory manner,” she said.

The deputy dean of the medicine faculty instead suggests looking at the United Kingdom’s introduction of e-cigarette as part of the framework for those who want to quit smoking, as a few studies suggested it is a safer alternative to combustible cigarettes.

“The UK’s National Health Services has strict regulation on e-cigarettes and this has been widely used to cut down on tobacco smoking, and e-cigarette have been prescribed and even sold at hospitals.

“It is stated in a few public health statements to be less harmful to your lungs. It is the better option but the end target is for you to stop smoking or vaping totally.

“The best option would be to consider vape as an alternative to be used to stop smoking but is supplemented with other stop smoking therapy methods and consistent motivation like behaviour therapy,” Sharifa said.

However, Adzwan alleges that the Health Ministry is not keen to pursue these alternatives as the ministry is pushing for the MQuit campaign partnering with pharmaceutical giant, Johnson & Johnson.

“We are asking for the vape to be taxed and made legal but now the tax is high and they are also charging for the zero-nicotine liquid.

“We are asking them to introduce vape as a safe method to quit but there is a conflict of interest as the ministry has the Jomquit programme.

“Johnson & Johnson has pumped money into the programme, it is not a cigarette company but pharmaceuticals that are looking to sell their medicines.”

Director-general of health Dr Noor Hisham Abdullah said in May around 21.3% of Malaysians are smokers, which makes up about roughly six million people.

The MQuit programme was introduced in 2015 and according to Health Minister Dr Adham Baba the ministry spent a total of RM2.8 million on smoking cessations and pharmacological treatments for 9,222 smokers last year alone. – December 16, 2020.