KUALA LUMPUR, March 31 — Putrajaya has gazetted an excise duty for vape liquids with nicotine content at 40 sen per millilitre, in its bid to tax liquid or gel products containing nicotine.

The new duty will come into operation beginning tomorrow following the commencement of Excise Duties (Amendment) Order 2023, according to a federal government gazette notice released today.

The Excise Duties (Amendment) Order 2023 was delivered by Prime Minister Datuk Seri Anwar Ibrahim under subsection 6(1) of the Excise Act 1976.

This gazette would then be presented before the Dewan Rakyat pursuant to subsection 6(2) of the Excise Act 1976.

During the tabling of Budget 2023 on February 24, Anwar who is also the finance minister announced the government will impose an excise duty on liquid or gel products containing nicotine, with half the revenue to be allocated to the Health Ministry.

He said that the liquid or gel products with nicotine — estimated to be worth RM2 billion in potential government revenue — were widely used with electronic cigarettes and vaping, despite this being technically illegal.

The previous government announced plans under Budget 2022 to expand tax collection to vape liquids containing nicotine by imposing excise taxes at RM1.20 per millilitre, but the enforcement was postponed.

A recent study by tobacco firm JTI Malaysia, based on projections, noted that the government missed the opportunity to collect RM866 million in taxes last year from liquids used for vaping or electronic cigarettes.

This comes as two associations representing healthcare professionals in Malaysia voiced their opposition to the government’s move to exempt nicotine as a controlled substance under the law ahead of the new taxation against vape products.