Kuala Lumpur, 1 August 2024 — To ensure that the Ministry of Health’s “war on sugar” campaign is effective and successful, in addition to raising excise duties on sugar sweetened beverages (SSB), the Malaysian Government must also remove sugar from the schedule of controlled items under the Price Control and Anti-Profiteering Act 2011.

“In his recent reply in the Dewan Negara, Health Minister Datuk Seri Dr. Dzulkefly Ahmad was correct to highlight sugar consumption as a fundamental problem when addressing the crisis of obesity in Malaysia. We support his proposals to raise the SSB tax to 20 percent of the retail price. After all, the National Health and Morbidity Survey 2019 estimates that Malaysians consume an average 12 teaspoons of sugar per day from sugar sweetened beverages,” said Azrul Mohd Khalib, Chief Executive of the Galen Centre for Health & Social Policy. “Perhaps this will help reduce that consumption.”

“The SSB tax at the current rate was expected to bring in at least RM 330 million in revenue. An increase in the tax rate will bring in much needed funds to help address the metabolic diseases which include Type 2 diabetes, cardiovascular disease and kidney disease.”

“This country now has the highest rate of diabetes in the Asia Pacific. Diabetes related complications are costing around RM 3.1 billion annually to treat. It is expected that 7 million Malaysian adults aged 18 and older will be either prediabetic or diabetic by next year. Half of more than 10,000 newly diagnosed patients with kidney failure each year have diabetes.”

“However, the newly collected revenue from the SSB tax will be all for nothing if the government persists in listing sugar as a gazetted item under the Price Control and Anti-Profiteering Act 2011,” Azrul emphasised.

“Sugar subsidies were supposed to have been abolished in October 2013. However, due to the price of sugar continuing to be controlled rather than determined by the market, the government was forced to provide payments to sugar manufacturers since November 2023. These publicly funded subsidies amount to RM1.00 per kilogram of sugar for raw sugar and refined sugar which translates to around RM42 million monthly, and between RM500 million to RM600 million yearly.”

“These subsidies wipe out any current and potential revenue gained from the increase in SSB taxes,” he pointed out.

“Malaysia currently has one of the lowest controlled sugar prices in the world. They are lower than those in sugar-producing countries such as Indonesia, Thailand, and the Philippines, where we get our raw sugar.”

“Artificially cheap sugar is driving higher sugar uptake. The direct consequence of cheap sugar is the continued and uncontrolled spread of diabetes in this country, causing other non-communicable diseases such as chronic kidney disease and cardiovascular disease, which bring about premature death. It is costing billions in funds, and thousands of lives each year.”

“What government places price controls on sugar, provides subsidies or incentives to sugar manufacturers to help recover their costs, and then imposes a sugar sweetened beverages (SSB) tax? How does it make any sense?”