KUALA LUMPUR, July 31 — The Ministry of Health (MOH) is pushing to raise the tax on sugar-sweetened beverages (SSB) to 20 per cent as part of its “war on sugar” campaign.
Health Minister Dzulkefly Ahmad, in a written Dewan Negara reply yesterday, outlined four “key priorities” for the government to consider, including a proposal to raise tax on sugary drinks to 20 per cent of the retail price, in line with the World Health Organization’s (WHO) recommendation.
The WHO suggests increasing sugary drink prices by at least 20 per cent to effectively reduce consumption and prevent obesity and diabetes.
“In principle, the MOH has been taking proactive steps to address the issue of obesity for some time. However, given that the National Health and Morbidity Survey (NHMS) still shows an increase in obesity prevalence, the MOH has intensified its efforts, improved existing programmes, and launched new initiatives,” Dzulkefly told Senator Zurainah Musa.
It is unclear whether the 20 per cent sugar tax will apply to ready-to-drink packaged beverages, such as soft drinks, or freshly made drinks like teh tarik and bubble tea.
Malaysia currently imposes an excise duty on sugar-sweetened beverages, specifically targeting ready-to-drink packaged sweetened drinks such as beverages with sugar exceeding 5g per 100ml and fruit juice or vegetable-based drinks with over 12g of sugar per 100ml.
This includes soft drinks, sports drinks, energy drinks, sweetened tea or coffee, flavoured milk, fruit juices, as well as flavoured syrups and concentrates.
The current sugar tax, increased from 40 sen to 50 sen per litre in Budget 2024, does not apply to freshly made drinks, such as those prepared on-site in cafes and restaurants. Malaysians primarily consume made-to-order drinks rather than carbonated soft drinks.
According to the NHMS 2023, about 15.6 per cent of the country’s adult population or 3.6 million adults in Malaysia, have diabetes. The country now has the highest rate of diabetes in the Western Pacific region, and one of the highest in the world, costing around RM 3.1 billion annually. Over half of the adult population in Malaysia are either overweight or obese.
Dzulkefly said the MOH is also proposing the introduction of a “Nutri-Grade” system, which rates beverages based on their sugar content. Dzulkefly previously described this system as similar to Singapore’s Nutri-Grade, which grades freshly prepared beverages from A to D based on their sugar and saturated fat content, effective December 30 last year.
Additionally, the MOH moots expanding reformulation initiatives for three types of high-sugar beverages in Malaysia: sweetened condensed milk, sweetened creamers, and cordials.
The MOH also plans to strengthen its “First 1,000 Days of Life” programme which ensures that all health services, from the start of pregnancy through the child’s second year, receive special attention. This includes focusing on every aspect of maternal and child care to prevent issues of malnutrition, Dzulkelfy said.
The health minister, however, did not specify if the government’s “war on sugar” will include ending price controls on sugar. Last year, Prime Minister Anwar Ibrahim suggested scrapping sugar subsidies to reduce diabetes cases.
Galen Centre for Health and Social Policy chief executive Azrul Mohd Khalib argued that it is inconsistent to wage a war against sugar while subsidising it.
Sugar remains a gazetted item under the Price Control and Anti-Profiteering Act 2011, making sugar prices in Malaysia are among the lowest globally.
Since 2018, prices have been capped at RM2.85 per kg for coarse sugar and RM2.95 per kg for refined sugar, which are lower than in neighbouring countries from whom Malaysia imports raw sugar and below the RM3.85 production cost to make retail sugar, Azrul said.
