In a policy paper released today, the Galen Centre for Health and Social Policy said based on 2017 revenue figures, the 5% would amount to about RM290 million.
It said between 2012 and 2017, an average of RM5.1 billion in sin tax was collected from tobacco and alcohol products, with the figure expected to reach RM6.1 billion in 2018.
The think tank said governments around the world had earmarked revenue from such products for health programmes, noting that at least 30 countries are using tobacco tax for this purpose.
Presently, the revenue from the sin tax goes directly into the government’s consolidated fund.
“Despite Malaysia already imposing significant excise duties to tax the consumption of products such as tobacco and alcohol, these are primarily punitive in nature and intended for control and decreasing uptake.
“The tax collected is consolidated with other government revenue. There has been no move yet to earmark the revenue collected for the purpose of health, specifically and directly funding NCD prevention, control and treatment,” Galen said in the paper titled “Policy for action: Earmarking sin tax to support Malaysia’s non-communicable disease (NCD) response”.
The policy paper is authored by Galen chief executive Azrul Mohd Khalib and research officer Jade See.
Galen said Malaysia had a high rate of NCDs like diabetes, hypertension, hypercholesterolemia, obesity and cancer, which account for 73% of total deaths.
“There are an estimated 3.6 million adult Malaysians living with diabetes, 6.1 million with hypertension, 9.6 million with hypercholesterolemia and 3.3 million with obesity. One in four Malaysians is estimated to be living with cancer,” said Galen.
It added that NCDs like cardiovascular diseases, diabetes, cancer, obesity and hypertension have shared risk factors including tobacco use, unhealthy diets, physical inactivity and harmful use of alcohol. Treatment of cancer, diabetes and cardiovascular diseases alone costs an annual RM11 billion.
Galen said 5% of the revenue should go towards strengthening NCD health promotions and treatment for diabetes and cancer.
“They should act as additional or supplementary funding, necessary to support upscaling of innovative programmes or fund crucial lifesaving medicines and treatment,” it said, adding that the earmarked funds should not be used to offset reductions or funding cuts to existing allocations under the budget.
Galen also said the earmarked funds should be managed by the health ministry together with a “multi-sectoral oversight committee”.