KUALA LUMPUR (Dec 3): A trade group has refuted a claim that duty-free areas are illegal cigarette hubs.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz was recently quoted in a report as saying his analysis had shown that the number of cigarettes consumed per capita, including tourists, in duty-free areas was just too high and did not make any sense.

He also reportedly said these duty-free areas can also become hubs for illegal cigarette trade.

Refuting the statement made by the minister, Labuan Chinese Chamber of Commerce president Datuk Wong Kii Yii said the business community as well as the people of Labuan "totally reject this claim".

“Based on our recorded sales numbers, Labuan sells a total of 300 million sticks of duty-free cigarettes annually, in tandem with local and tourist demand.

“This is a far cry from the minister’s ‘high volume that makes no sense’ comment,” he said in a statement yesterday.

Wong said the Ministry of Finance (MoF) was misinformed of how illegal cigarette syndicates operate.

He said there needs to be a distinction between what is claimed to go into duty-free islands and what is sold on duty-free islands.

“Once that is established, the right control is then to limit the quantity that goes into the islands instead of removing their duty-free status completely.

“Cigarettes are one of the most popular retail items in any duty-free area.

‘Take it out of the equation and there will be a severe shortfall in retail income,” said Wong.