Wong Kii Yii
LABUAN: The Labuan Chinese Chamber of Commerce today said that the recent statement made by Finance Minister Senator Dato’ Seri Tengku Zafrul Aziz, which implied that duty free areas are illegal cigarettes hub, is incorrect and uncalled for.
In an interview with The Edge Malaysia, Zafrul was quoted as saying that his analysis has shown that the number of cigarettes consumed per capita, including tourists, in duty free areas is just too high and does not make any sense. He also said that these duty free areas can also become a hub for illegal cigarettes trade.
Labuan Chinese Chamber of Commerce president Datuk Wong Kii Yii said the business community as well as the people of Labuan totally rejected this claim made by the Finance Minister.
He said this statement reflects badly on the Ministry of Finance as well as the Perikatan Nasional Federal Government led by Prime Minister Tan Sri Muyhiddin Yassin.
“We would like to see for ourselves the Finance Minister’s so-called analysis that prove duty free areas act as hubs for the illegal cigarettes trade”.
“Based on our recorded sales numbers, Labuan sells a total of 300 million sticks of duty free cigarettes annually, which is in tandem with local and tourist demand. This is a far cry from the minister’s ‘high volumes that makes no sense’ comment.”
According to Wong, the Ministry of Finance has not only gotten its math wrong. The ministry is also clearly misinformed on how illegal cigarettes syndicates operate. There needs to be a distinction between what is claimed to go into duty free islands and what is sold in duty free islands. Once that is established, the right control is then to limit the quantity that goes into islands instead of removing duty free status completely.
“We would like to invite the minister as well as MOF officials to visit Labuan and investigate. Go ahead, audit us. Our members will be more than happy to cooperate. Our island is not that big, it is hard to hide containers full of cigarettes,” he added.
The Labuan Chinese Chamber of Commerce also said that the national economy will suffer when excise duties are imposed on duty free cigarettes based on MOF’s erroneous analysis.
“Cigarettes are one of the most popular retail items in any duty free areas. Take it out of the equation and there will be a severe shortfall in retail income.’
“Already Labuan’s economy has been hammered by the decline in the oil and gas sector. The Covid-19 pandemic and now, the new excise duties on duty free cigarettes, may just be the straw that breaks the camel’s back,” he concluded.