2 March 2026, Kuala Lumpur \u2013 The Malaysia Singapore Coffee Shop Proprietors\u2019 General Association (MSCSPGA) urges the Government to take a stronger and more practical action to tackle illicit cigarette trade, warning that rising costs and widening price gaps are placing legitimate retailers under increasing pressure.<\/p>\n\n\n\n
The association\u2019s comments follow the recent release of the Illicit Cigarette Study (ICS) 2025, which shows that the national prevalence of illicit cigarettes remains high at 54.4% – only a 0.4% drop from January 2025, when the rate was at 54.8%. This means that more than half of all cigarettes consumed in Malaysia continue to come from illegal sources.<\/p>\n\n\n\n
MSCSPGA acknowledged and appreciated the continued efforts by enforcement agencies, particularly the Royal Malaysian Customs Department and other authorities, for their sustained operations to disrupt smuggling routes, seize contraband and curb illegal supply.<\/p>\n\n\n\n
\u201cWe have seen more seizures at retail outlets selling illicit cigarettes. Enforcement agencies have shown professionalism and determination, often operating under difficult conditions. These efforts are important and deserve recognition,\u201d said Wong Teu Hoon, President of MSCSPGA.<\/p>\n\n\n\n
However, Wong said the problem must also be seen in today\u2019s cost-of-living situation, where coffee shop operators and small retailers are already facing higher operating costs, including rental, utilities, labour and raw materials.<\/p>\n\n\n\n
\u201cLegal cigarette prices have gone up and customers are already feeling the pressure from higher living costs. At the same time, illegal cigarettes are being sold for as low as RM5, which is more than half the price of legal products. This makes it very hard for us as retailers who follow the law and sell at the proper market price,,\u201d he said.<\/p>\n\n\n\n
The association said this is unfair to businesses that comply with regulations and pay taxes, as they must compete with illegal products that avoid duties and sell at much lower prices.<\/p>\n\n\n\n
\u201cWe are trying our best to follow the rules, so it is very frustrating for us, but demand for illegal cigarettes is still high they are cheaper. The Government may need to look at other practical ways to address this issue,\u201d Wong added.<\/p>\n\n\n\n
\u201cEnforcement is necessary, but but solutions should also take into account retail realities and consumer behaviour. We need an approach that supports honest businesses,\u201d Wong concluded.<\/p>\n\n\n\n
Editor\u2019s Take:<\/p>\n\n\n\n
We are witnessing a Market Distortion that threatens the integrity of Malaysia\u2019s tax base. When more than half of a market is illegal, “honest” retailers are effectively being penalised for compliance. This is a classic case where fiscal policy (excise hikes) has collided with economic reality (low disposable income), creating a thriving environment for organised crime. <\/p>\n\n\n\n
This is precisely why the individuals safeguarding our borders must be held to the highest standard of responsibility. There is a fundamental reason these officers took an Oath of Office<\/strong>: to protect the sovereignty and economic security of the nation. When “trusted insiders” or double-dealers allow contraband to slip through for personal gain, they aren’t just breaking a rule, they are betraying that oath and sabotaging the livelihoods of every honest, tax-paying coffee shop owner in the country. If Malaysia is to achieve the “inclusive prosperity” promised in the 13MP, we must ensure that our first line of defence is unshakeable.<\/p>\n\n\n\n This is an issue of SME Resilience. If the backbone of Malaysia’s retail sector, traditional coffee shops, cannot remain viable through legal sales, it undermines the socio-economic goals of the 13th Malaysia Plan. Furthermore, the estimated RM5 billion annual tax leakage is revenue that is desperately needed for national infrastructure and the green transition.<\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" 2 March 2026, Kuala Lumpur \u2013 The Malaysia Singapore Coffee Shop Proprietors\u2019 General Association (MSCSPGA) urges the Government to take a stronger and more practical action to tackle illicit cigarette trade, warning that rising costs and widening price gaps are placing legitimate retailers under increasing pressure. The association\u2019s comments follow the recent release of the […]<\/p>\n","protected":false},"author":5,"featured_media":6912,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34,23],"tags":[122,273,268,226,267,266,263,272,264,265,270,271,269,274,262],"class_list":["post-6911","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","category-lifestyle","tag-13mp","tag-costofliving","tag-customsmalaysia","tag-ekonomimadani","tag-honestbusiness","tag-ics2025","tag-illicittrade","tag-malaysiaretail","tag-mscspga","tag-retailsqueeze","tag-shadoweconomy","tag-smeresilience","tag-taxleakage","tag-tobaccocontrol","tag-wongteuhoon"],"_links":{"self":[{"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/posts\/6911","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/comments?post=6911"}],"version-history":[{"count":1,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/posts\/6911\/revisions"}],"predecessor-version":[{"id":6913,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/posts\/6911\/revisions\/6913"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/media\/6912"}],"wp:attachment":[{"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/media?parent=6911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/categories?post=6911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/malaysian-business.com\/portal\/wp-json\/wp\/v2\/tags?post=6911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}