Malaysia taxed by flood of cheap foreign beers
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The influx of cheap foreign beer in Malaysia may be costing the country up to 250 million ringgit (Bt2.42 billion) in lost taxes annually.
Industry sources claim that high-alcohol beers from Thailand, the Philippines, China and Europe have flooded the market and are being sold at almost half the price of locally-produced beer at coffee shops, convenience stores and even supermarkets here.
The low prices and easy availability have made the brew attractive to consumers, particularly lower-income groups like labourers and migrant workers.
“The supply of cheap foreign beer, with a higher-than-average alcohol volume, has increased five-fold in the past five to seven years,” said one source, who spoke on condition of anonymity.
While uncollected duty from cheap imported beer is estimated to be 250 million ringgits, total tax evasion on all alcoholic beverages is thought by some to be as high as 1 billion ringgit.
Another source pointed out that imported beer should logically cost more than locally produced beer if legally brought into the country as the import tax alone would be about 5 ringgit per litre.
Moreover, importers should pay a higher excise duty on beer with higher alcohol content.
The sources also questioned how foreign beer, despite having almost twice the alcohol content of locally-brewed beer, could be sold for as low as 4.29 ringgit per 330ml can or 7 ringgit per 550ml can (in some places, it’s only 5 ringgit) compared to premium imported beer brands that were priced from 9 ringgit per bottle.
A customs department official, who declined to be named, said beer pricing was not regulated by the department.
“Sometimes, beer is sold cheap when near its expiry date,” he offered.
Domestic Trade, Cooperatives and Consumerism Minister Hasan Malek said the ministry worked together with other agencies during raids to confiscate counterfeit beer.
“We have just called for a joint meeting with other agencies to discuss how we can work together to solve this problem,” he said.
