Labuan duty free status review

[admin]

Labuan: The Government is considering scrapping the island's free-port status if the "rampant" smuggling of especially cigarettes and beer cannot be stopped.

Federal Territories and Urban Wellbeing Minister Dato Raja Nong Chik Dato Zainal Abidin said the Finance Ministry had noted that smuggling in Labuan has become very serious and is causing the Government huge loss of revenue.

"A proposal has been made to scrap the status of the island.

However, we disagreed and have called for a review instead," he said.

Hence, the Government is now reviewing the status "and one proposal is that the free port status remains but, import of duty-free items be controlled to ensure availability only to local residents and tourists.

The other solution is to beef up enforcement to eliminate the smuggling menace. "No decision has been made yet as the review is still in progress," said Raja Nong, after a meet-the-people session at the Convention Hall of the Financial Park.

Giving some clue on the scale of suspected smuggling Raja Nong said based on a report, the import of duty-free cigarettes into Labuan worked out to the equivalent of five cartoons (10 packs per cartoon) per individual per day.

Raja Nong said the FT Ministry's view is that the status remains because its withdrawal would have some adverse effect on the local economy.

Labuan has been a free port since 1942. The status was given by the colonial administration since the island had no natural resources or industries to spur the local economy. Presently apart from Labuan, Langkawi and Pulau Tioman are also free ports.

Recently, an army of enforcement officials under an Uumbrella operation investigated a dozen importers of beer and seized documents for investigations the Anti-Money Laundering and other Acts.

The investigations are still in progress.

Accounts of the importers had been frozen but lately the feeze on some were lifted after payment of deposits in excess of RM1 million.

Prior to this, Customs officials from Kuala Lumpur were stationed at the Customs gates to monitor the import and export of goods for about six months.

[ayamkampung]

this is bad. can't get any cheap beers at labuan