THE Galen Centre for Health and Social Policy has criticised the government’s decision to raise cigarette excise duty by only two sen per stick under Budget 2026, calling it a wasted opportunity to boost revenue and strengthen Malaysia’s healthcare system.
“It is disappointing that after 10 years of no excise duty increases on cigarettes and other tobacco products, the best that the government could manage was a meagre increase of two sen per stick,” said Galen CEO Azrul Mohd Khalib.
“If this was 77 sen per stick, equivalent to 61% excise tax of the retail price, it would generate an additional tax revenue of RM771.8mil.”
Malaysia has not raised tobacco taxes since 2014. Azrul noted that the current tax rate of 58.6% remains below the World Health Organisation’s 75 percent benchmark.
“Malaysia spends an estimated RM16bil annually treating smoking-related illnesses. For every RM1 collected from tobacco excise duties, RM4 is spent on treatment,” he said.
He urged the government to introduce a national health and social insurance scheme to raise RM6 billion annually, saying, “We need to invest in future-proofing and increasing the resilience and sustainability of the public healthcare system.” — Oct 11, 2025
Main photo credit: Nicotex
