FSGMAM Urges Tougher Enforcement Against Contraband Cigarette Sellers

KUALA LUMPUR, Oct 21 (Bernama) -- The Federation of Sundry Goods Merchants Associations of Malaysia (FSGMAM) has urged the authorities to intensify inspections of premises selling contraband cigarettes, including follow-up checks on those previously raided.

Its president, Hong Chee Meng, said frequent inspections and consistent enforcement were essential to protect legal retailers from competition posed by the open sale of contraband cigarettes.

He said the association's members operated legally, paid taxes and held the necessary licences, yet risked losing customers to sellers offering contraband cigarettes at lower prices.

"We welcome the government's RM1.1 billion allocation under Budget 2027 to strengthen enforcement agencies.

"The allocation gives hope to grocery store owners and small retailers who continue to lose customers due to the open sale of contraband cigarettes. It also demonstrates the government's commitment to strengthening enforcement on the ground," he said in a statement today.

Hong also welcomed Budget 2027 measures to ease the cost burden on small businesses, including a one percent reduction in the income tax rate for small and medium enterprises (SMEs) and additional financing facilities for micro, small and medium enterprises (MSMEs).

However, he said these benefits could be undermined if legal retailers continued to lose customers to contraband cigarettes sold at lower prices than legal products.

"Consumers are naturally attracted to lower prices, making it difficult for legal retailers to compete. Grocery store owners are also facing rising costs for rent, utilities, stock and operations. Competing with illegal products sold openly is therefore unsustainable," he said.

He urged the authorities to take stern action against premises that repeatedly sold illegal cigarettes, including those rented out by local owners to foreigners for illegal business activities.

Hong said the call was in line with Prime Minister Datuk Seri Anwar Ibrahim's recent call for stricter action against illegal businesses, including licence revocation.

He cited a recent enforcement operation in Puncak Alam, during which three business premises operated by foreigners were ordered to close and 18 compounds were issued for various offences, including the sale of suspected untaxed cigarettes.

"We are not asking for special treatment. We only want the law to be enforced fairly and consistently, with stern action taken against premises selling illegal cigarettes, including closure where permitted by law.

"Retailers who run their businesses legally should not be disadvantaged simply because they abide by the law. All parties must be subject to the same standards," he said.

When tabling Budget 2027 on Oct 9, the government announced an allocation of RM1.1 billion for key enforcement agencies to strengthen operations against revenue leakage and smuggling.

The agencies include the Royal Malaysian Customs Department (JKDM), the Royal Malaysia Police (PDRM), the Ministry of Domestic Trade and Cost of Living (KPDN), the Malaysian Anti-Corruption Commission (MACC) and the Malaysia Competition Commission (MyCC).

-- BERNAMA