BAT urges govt to increase enforcement against black market

British American Tobacco Malaysiahas urged the government to focus on tackling the tobacco black market, which is expected to see an increase in activity following the reopening of borders on 1 April, reports The Edge Market.

BAT Malaysia Managing Director Nedal Salem pointed out that the black market currentlydaominates about 60 per cent of the total market and causes a loss of MYR 5 billion (USD 1.15 billion) in tax revenue every year. “Smugglers are also now using vessels to bring in their black market goods. Hence, we urge the government to continue to increase enforcement, especially in coastal areas, and maintain policy stability, including closing the price gap between legal and black market tobacco products,” he said.
Nedal said he was encouraged by the government’s focus to regulate the vape industry, adding that any regulations must be science-based to reduce the impact of smoking. He continued that regulation will not only allow vapers access to lower-risk alternatives, but also ensure the products used are compliant with quality and safety standards.
On the group’s performance in 2021, Nedal said BAT Malaysia recorded volume growth for the first time since 2002 and profit growth for the first time since 2015. “This positive trajectory was due to the reduction in tobacco black market incidence and our increase in market share, which in turn improved revenue and profit from operations,” he said.
BAT fell MYR 0.22 or 1.7 per cent to close at MYR 12.66 on 27 April, representing a market capitalisation of MYR 3.61 billion.

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