
Excise
Malaysia’s excise rate on beer is the second highest in the world, alongside Singapore and behind Norway, despite both countries having much greater purchasing power than Malaysia. In 2016, Norway’s household income per capita was more than 9 times greater than Malaysia’s.
Furthermore, the current excise regime is inequitable, with a higher tax rate imposed on lower alcohol content beverages, such as beer and stout, compared to higher alcohol content beverages like wine and spirits. According to international best practices, excise tax on alcohol should correspond with the alcohol content of the beverage, with the highest duties being imposed on liquor and spirits.
Our current inequitable tax regime, with high excise placed on beer, is causing many price-conscious consumers to turn to illicit (contraband, counterfeit and unregulated) beer.
Countries
€/liter
Norway
Malaysia
Singapore
Sri Lanka
Australia
Thailand
United Kingdom
Indonesia
New Zealand
Taiwan
Myanmar
Vietnam
Cambodia
Laos
Mongolia
China
Hong Kong
*Source : The Socio-Economic Impact of CMBB in Malaysia by Steward Redqueen (December 2018)
Excise Per Degree of Alcohol
Compounded Hard Liquor

ABV
40%
RM 0.60 / degree of alcohol
Premium Hard Liquor

ABV
40%
RM 1.50 / degree of alcohol
Wine

ABV
14%
RM 1.50 / degree of alcohol
Beer

ABV
5%
RM 1.75 / degree of alcohol
*Alcohol by Volume (ABV) is a measure of how much alcohol is in beverage
*Source : The Socio-Economic Impact of CMBB in Malaysia by Steward Redqueen (December 2018)

Beer
Wine
Premium Hard Liquor
Compounded Hard Liquor
Ideal trend of excise duty according to international best practice
Current Excise Structure
The graph shown represents the excise duty that is imposed on industry players of Beer, Wine, Premium Hard Liquor and Compounded Hard Liquor. The best international practise clearly defines higher excise duty for higher alcohol contents based on Alcohol by Volume (ABV), where Beer and Compounded Hard Liquor are on opposite ends.
However, in Malaysia, the excise based on ABV is reversed where Beer is subjected to highest excise duty compared to the highest ABV, which is Compounded Hard Liquor. This trend has continued from the past and even till present which impacts the industry and its contribution to the economy overall.