Customs Dept Strengthens Strategies, Global Cooperation To Combat Illicit Threat

PUTRAJAYA, Jan 21 (Bernama) -- The Royal Malaysian Customs Department (Customs) aims to strengthen its strategies and international cooperation to protect the country’s economy from illicit threats, its Intelligence Division director Cheong Yu Min said.

He reiterated the department’s commitment to combating smuggling and organised crime, emphasising the importance of international collaboration.

“Smuggling is closely tied to organised and transnational crime. The Customs Department participated in over 10 international operations in 2024, which provided critical information leading to case successes,” he said as a panellist at the Asia 2025 International Security Summit and Expo (AISSE) during a session titled ‘Defending National Economies: Strategies to Combat Illicit Trade and Strengthen Economic Resilience’.

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He said last year alone, the department recorded its highest-ever revenue collection of RM65.57 billion, and handled more than 7,000 cases involving misdeclaration, undervaluation, and other offences.

 “We are responsible for indirect taxes, while the Inland Revenue Board of Malaysia (LHDN) manages direct taxes. Our focus is on commodities, and their classification determines whether they are taxable or require permits.

“Fuel commodities remain a priority for us,” he explained, adding that tobacco and liquor seizures accounted for over 3,500 cases.

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On narcotics, Cheong said the Customs Department successfully handled more than 500 cases in 2024, and the total value of smuggled goods and indirect tax offences uncovered exceeded RM1.6 billion.

“We are targeting large-scale syndicates and significant shipments, prioritising impact over quantity,” he said, while reaffirming the department’s determination to achieve even greater revenue collection and operational success in 2025.

Fellow panellist Ahmad Shahran Shafiae, who serves as Director of the Anti-Money Laundering and Anti-Terrorism Financing (AMLA) Management Section, Investigation Department, LHDN, shared that the dynamic and evolving nature of illicit trade posed a significant threat to Malaysia’s economy, as it drained public resources and undermines government revenue.

“If you have illegal business activities and fail to declare the income to LHDN, it results in tax losses for the country. Even legal businesses importing goods from countries like China may contribute to tax losses if they do not comply with tax declaration obligations,” he said, adding that the shadow economy, which includes undeclared and illicit trade activities, represents more than just a threat to law and order.

“It’s a silent drain on public resources,” he said, pointing out that the taxes collected were crucial for funding essential public services such as schools, roads, utilities, and law enforcement operations.

Ahmad Shahran also noted that the rise of digital platforms and e-commerce had transformed the landscape of illicit trade, making it increasingly challenging for enforcement agencies to monitor and regulate such activities.

 “The digital transformation has enabled illicit trade to expand into areas such as cryptocurrency transactions and online marketplaces. The e-commerce platforms offer competitive prices, but they also provide opportunities for unregulated transactions,” he said.

He also highlighted the importance of addressing emerging sectors, such as the e-waste industry, which generates significant income but also contributes to environmental pollution.

“An e-waste processing facility can generate more than RM100 million annually. While the economic potential is high, the pollution stays in our country,” he concluded.

-- BERNAMA