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JTI Cambodia advocates for fair tobacco regulations

Cambodia Investment Review

Japan Tobacco International (JTI Cambodia) – one of the country’s leading tobacco distributors – is pushing to ensure a ‘level playing field’ in the industry as the company invests heavily into its workforce and the overall economy.

JTI Cambodia is currently the exclusive distributor of the country’s leading cigarette brands, Mevius and Winston.

Roy Manalili, General Manager of JTI Cambodia told Cambodia Investment Review the industry was looking for the government to implement consistent and fair laws adding that any regulation must not allow ‘black market’ dealers to prosper.

“As a responsible tobacco supplier, our attitude is that we provide a legal product following all local and international trade laws,” Manalili said.

A top taxpayer in Cambodia

JTI was recently recognized as one of the Kingdom’s top taxpayers by Prime Minister Hun Sen issuing a statement outlining the meaningful participation from the private sector which is an important development partner to the Government, and a key pillar for the development and growth of the national economy.

The Prime Minister added that JTI Cambodia – who ranked 22nd in the list of taxpayers – has always cooperated with the Government and law enforcement agencies, especially the Ministry of Economic and Finance by sharing knowledge, best practices and information on better-operating environments, tax policies and illicit trade.

“We are proud of this top taxpayer recognition and that’s why we believe it’s important for the Cambodian government to introduce strategic tax policies that allow law-abiding companies – such as JTI Cambodia – to continue providing sustainable tax benefits to the Kingdom,” Manalili said.

“Excessive and/or sudden tax increases make legal tobacco products unaffordable, driving smokers toward cheaper illegal products, an example of which is Malaysia where more than half of tobacco sales are driven by the black market”, Manalili added.

The comments come as Cambodia is currently in the process of developing a tobacco tax roadmap to guide future long-term policy, amid calls from NGOs to increase tax rates with estimates of tobacco imports over $246 million.

The government has discussed possible plans to increase tobacco tax to 75% of the retail price of cigarettes following the recommendations by the World Health Organization – from the current 20% now imposed.

A level playing field for all tobacco distributors in Cambodia

Another of JTI’s concerns is that not everyone is held to the same standards. Since the 2016 legislation that requires cigarette manufacturers to apply graphic images and warning labels to their packaging, some brands are still imported with unmarked products.

“Cambodia has strict regulations that were implemented for a reason; as a law-abiding company, we aim to always obey these rules and would expect other companies to do the same,” Manalili said.

Another ‘fair playing field’ initiative JTI Cambodia would like to see implemented is a ‘per cigarette fixed fee’ as opposed to the current system of taxation based upon value.

“We believe a fixed per cigarette fee should be applicable and would prevent some manufactures from a race to the bottom in pricing terms for their products,” Manalili said.

JTI Cambodia investing heavily in its workforce

Most recently the company was recognized for its Human Resources (HR) best practices as a Global Top Employer and became the first and the only company in the country to receive the certification from Top Employers Institute, a Holland-based global prestigious HR expert.

During the COVID pandemic, JTI Cambodia retained all employees so they could have jobs and all the benefits including the year-end bonus to support their family during a difficult time, the company said.

One of JTI Cambodia’s most generous staff benefits is all staff – regardless of their gender – receive five months of fully paid leave to take care of their family when they welcome a newborn child.

“To achieve this we have invested heavily in our – predominately local – staff. We believe this strong workforce investment is the key to our strong company culture, offering fantastic benefits and increasing staff retention,” Manalili said.

“Looking to the future and continuing to invest in our workforce remains the most important element to ensure that JTI Cambodia can keep up with the rapidly changing times ahead for the country and the international tobacco industry,” he added.

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