Industry players say that supplemental milk for pregnant women and nursing mothers may see an increase in price if the government proceeds with the sugar sweetened beverages (SSB) tax which is currently at the negotiation stage.
Soh Thian Lai, president of the Federation of Malaysian Manufacturers (FMM), said the finance ministry had yet to list milk products for adults as an exempted product from the tax.
"With the rising inflation rate in Malaysia, the imposition of excise duties on selective food and beverage products will not only cause a direct increase in the price of much needed items for lower income groups, it will further erode consumers' purchasing power for food and beverage products," he said.
So far, only baby formula has been granted an exemption from the SSB tax.
Soh said that supply and demand factors would also play a role in the price fluctuations of supplemental milk for pregnant women and nursing mothers.
The former goes for about RM38 to RM70, depending on the brand and volume. Milk for nursing mothers, meanwhile, is being sold for between RM34 and RM86.
The SSB tax was announced in the budget for 2022 and expanded to include cocoa and chocolate-based pre-mixed products.
Meant to be enforced on April 2, 2022, it was postponed twice, on Nov 1, 2022 and Jan 1, 2023.
Soh said the excise duty covered a range of products including milk powder and formulated diet food products.
"FMM has asked the ministries of health and finance to study the tax on non-premixed products, which should not be included," he said.
Women's organisations have also called for supplemental milk for pregnant women and nursing mothers to be excluded from the tax.
"We believe that the price increase arising from the imposition of this tax will burden the women who need these products to help them in the various phases of pregnancy, care and breastfeeding, especially mothers from the B40 group and those with moderate incomes," the Kuala Lumpur and Selangor Coalition of Women Organization said in a letter dated November 2022.
Soh meanwhile said that the customs department, which is responsible for overseeing the tax, had yet to prepare a list of the products to be exempted from the excise duty.
He urged the government to hold immediate discussions with industry players, given the impact the tax would have on manufacturing operations and the supply chain.
While FMM appreciated and supported efforts to control obesity, he said, the country would do better with a holistic approach to improving diets, increasing physical activity, and raising awareness in order to bring about change.