KUALA LUMPUR, Nov 6 -- The government will freeze the issuance of new import licence for cigarette effective Jan 1, 2021 as one of the strategies to improve revenue collection and address smuggling activities especially for high duty goods.

Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said from Jan 1, 2021, the government will also tighten the renewal of import licence for cigarette through a review of licence conditions including the imposition of import quota, and limit the transshipment of cigarettes to dedicated ports only.

"The government will also impose tax on the importation of cigarettes with drawback facilities for the purpose of transshipment and re-export.

"The government will not allow the transshipment and re-export of cigarettes by using small boats and impose duty on cigarettes and tobacco products in all duty-free islands from Jan 1, 2021," he said during the tabling of the Budget 2021 in the Dewan Rakyat here, today.

According to Tengku Zafrul, the government will also impose an excise duty of 10 per cent ad valorem on devices for all types electronic and non-electronic cigarettes including vape effective Jan 1, 2021.

 Meanwhile, liquid used in electronic cigarettes will be imposed an excise duty at a rate of 40 sen per millilitre, he said.

“Currently, government revenue is around 15 per cent of the gross domestic product (GDP) including petroleum-related revenue of around three per cent. 

"The government needs to ensure that the revenue source is sustainable and able to finance expenses especially operating expenses," he said, adding that the Multi-Agency Task Force will be strengthened with the participation of the Malaysian Anti-Corruption Commission and the National Anti-Financial Crime Centre.

-- BERNAMA