Malaysia Considers Tobacco Tax Hike After 10-Year Freeze

The Malaysian government is considering a proposal to increase the tobacco tax, which has not been raised since September 2014, Prime Minister Anwar Ibrahim has confirmed. Anwar, who is also the finance minister, stated that the proposal aligns with the government’s commitment to public health and fiscal reform.

Currently, Malaysia’s tobacco tax accounts for 58.6% of retail prices, and the country lacks a formal mechanism for periodic adjustments. “I agree with the spirit of that proposal. I myself not only do not smoke, but also fully support anti-smoking campaigns,” Anwar said in response to questions about a potential tax revision in Budget 2026.

This consideration follows Anwar’s announcement under the 13th Malaysia Plan to broaden “pro-health” taxes beyond sugary products to also cover tobacco, vapes, and alcohol. The expanded tax framework aims to encourage healthier behaviors, curb the rising prevalence of non-communicable diseases (NCDs), and increase state revenue to support a public healthcare system under growing strain.

• Read more: Malaysia’s Tobacco Display Ban to Affect Over 51,000 Shops
• News source: Govt considering raising tobacco tax

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