INCREASED PENALTIES FOR SMUGGLING OFFENCES UNDER CUSTOMS ACT 1967

Overview:
The recent amended to the Customs Act 1967 which was gazetted on 28th December 2018 and effective on 2nd January 2019 brought changes to the penalties related to smuggling offences under the Customs Act 1967.

Content:
The amendment had introduced heavier penalties for smuggling offences relating to cigarettes containing tobacco and intoxicating liquor besides increased the penalties for prevailing smuggling offences under Section 135 of the Customs Act 1967. The comparison of penalties before and after amendment are as summarized in the schedule below:-

Maximum penalty before amendment	Maximum penalty after amendment
penalty relating to smuggling offences, evasion of duty, fraud, etc
cases involving dutiable goods including cigarettes containing tobacco and intoxicating liquor	cases involving dutiable goods other than cigarettes containing tobacco and intoxicating liquor
1st offence Fine not more than 20 times of the customs duty or imprisonment up to 3 years or to both 2nd & subsequent offence Fine not more than 40 times of the customs duty or imprisonment up to 5 years or to both	1st offence Fine not more than 20 times of the customs duty or RM 500,000 (whichever greater) or imprisonment up to 5 years or to both 2nd & subsequent offence Fine not more than 40 times of the customs duty or RM 1,000,000 (whichever greater) or imprisonment up to 7 years or to both
cases involving prohibited goods including cigarettes containing tobacco and intoxicating liquor	cases involving prohibited goods other than cigarettes containing tobacco and intoxicating liquor
1st offence Fine not more than 20 times the value of the goods or imprisonment up to 3 years or to both 2nd & subsequent offence Fine not more than 40 times the value of the goods or imprisonment up to 5 years or to both	1st offence Fine not more than 20 times the value of the goods or RM 500,000 (whichever greater) or imprisonment up to 5 years or to both 2nd & subsequent offence Fine not more than 40 times the value of the goods or RM 1,000,000 (whichever greater) or imprisonment up to 7 years or to both
-Nil-	cases involving dutiable cigarettes containing tobacco or intoxicating liquor
-	1st offence Fine not more than 20 times of the customs duty or RM 500,000 (whichever greater) or imprisonment up to 5 years or to both 2nd & subsequent offence Fine not more than 40 times of the customs duty or RM 1,000,000 (whichever greater) or imprisonment up to 5 years or to both
-Nil-	cases involving cigarettes containing tobacco or intoxicating liquor which are prohibited goods
-	1st offence Fine not more than 20 times the value of the goods or RM 500,000 (whichever greater) or imprisonment up to 5 years or to both 2nd & subsequent offence Fine not more than 40 times the value of the goods or RM 1,000,000 (whichever greater) or imprisonment up to 5 years or to both

Conclusion:

The significant increase in the quantum of penalties for economical offenders in the recent amendments to the Customs Act 1967 is to ensure strict enforcement by Customs authority in curbing smuggling offences irrespective of quantity and value. Thus, in simplicity the amendment disclose the ultimate intention of Legislature to enable the Customs authority to arrest anyone in the streets found carrying or in possession of any class of dutiable/uncustomed/prohibited goods on import or export and demand for the production of proof on the payment of duties; failing which to charge the person arrested in the court of law.