DARE Warns Malaysia: Vaping Bans Will Expand Illicit Market; Strengthen Enforcement Within Existing Framework

Key Points

• DARE warns that bans would exacerbate illicit trade, undermine investment and employment, and cause tax leakage.
• MVA survey: 74% fear a ban would drive illicit sales; 80% worry about unsafe, unregulated products.
• Industry size & jobs: Malaysia’s vaping sector was once valued at about RM3.48 billion, supporting over 31,500 jobs, before contracting sharply.
• MOH data: After Act 852 took effect, registered brands fell from 3,200 to 390 in less than a year.
• DARE’s position: Act 852 already provides a national regulatory framework and youth protections; enforcement and consistency—not bans—should be the priority.
• FX reference: RM3.48 billion ≈ US$824 million (reference rate on Sept 28, 2025: RM1 ≈ US$0.2369).

2Firsts, September 28, 2025 — According to Focus Malaysia, Datametrics Research and Information Sdn Bhd (DARE) warns that current proposals for state-level or nationwide e-cigarette bans would bring a series of negative economic and regulatory consequences, including expansion of the illicit market, weakened investor confidence, tax revenue losses, and job cuts.

DARE’s statement aligns with findings from the Malaysian Vapers Alliance (MVA). In its latest consumer survey, 74% of respondents said a ban would spur illicit sales, while 80% expressed concern about unsafe, unregulated products entering the market. DARE Managing Director Pankaj Kumar noted, “Bans have never been an effective policy tool—whether for alcohol, tobacco, or vaping products. They only strengthen illicit markets by exploiting compliance loopholes, causing governments to lose billions in tax revenue, squeezing legitimate businesses, and destroying jobs.”

DARE added that Malaysia’s vaping industry was previously valued at approximately RM3.48 billion (about US$824 million) and supported more than 31,500 jobs, but the market has contracted sharply due to regulatory changes. Citing Ministry of Health (MOH) data, DARE said that since the 2024 Public Health (Control of Smoking) Act (Act 852) came into force, the number of registered brands fell from 3,200 to 390 in under a year. This contraction, DARE argued, is not driven by a lack of consumer demand but by regulatory gaps and inconsistencies between federal and state rules, which have enabled the illicit market for nicotine-containing e-cigarettes to grow.

Pankaj emphasized that consumers are being pushed toward untaxed, unregulated, and potentially unsafe products, directly harming the economy. He stressed that Act 852 establishes a nationwide regulatory framework and strict protections for minors, making consistent enforcement the most economically rational approach—rather than introducing new bans. “Every ringgit spent on the black market is a direct loss to legitimate businesses and to the public purse. The economy needs regulatory certainty and enforcement, not prohibition.”