LABUAN: The increased excise duty rate announced under Budget 2026 though bad news for happy hour revellers on the Sabah is good news for those in Labuan, according to a leading alcoholic beverage distributor.
“While the excise duty effect will inevitably increase the price of the product in other towns, over here it will remain intact as the island enjoys free port privilege and exemption,” said Arthur Kong.
“With the cost of booze remaining unchanged and even cheaper, it will likely draw weekend visitors as the cost of rest and recreation is cheap. This offers hope for the tourism industry to gain some sparkle,” he said.
He said the local economy has been in the doldrums for sometimes since a PAS Federal Territories Minister imposed tax on sales of cigarettes and dented a major attraction of the island.
“We hope things would gradually change with the continued efforts of the government to rejuvenate the economy,” said Arthur.
He also hoped the government would review the Customs rule to limit visitors leaving the island with no more than four cans of beer or a bottle of liquor.
Arthur said it should be borne in mind that accessing Labuan via air is costly while using ferries was a hassle and inconvenient due to immigration screenings.
He said duty-free shops specialising in the sale of varied brands of booze, liquor, imported chocolates and perfumes, would benefit if more tourists came noting that this economic sector supported hundreds by providing jobs.
According to the Budget, the higher excise duty rate will be effective Nov 1.
