[UPDATED] States have final say on beer licensing: Tengku Zafrul

KUALA LUMPUR – State governments have full prerogative to decide whether to mandate liquor licences on businesses, Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz told Dewan Rakyat today.

This means the federal government’s decision to backtrack a policy that requires coffee shops and restaurants to get additional licences to sell beer and stout is not final, as states have the last say.

Tengku Zafrul said that licensing for liquor sales is under the jurisdiction of the Licensing Board, which is appointed through the delegation of the finance minister’s powers to state menteri besar and chief ministers.

So, he said any matters related to the licensing of liquor sales have to obtain the approval of the Licensing Board, in line with the Excise Act 1976.

“As of today, there are no amendments made to the aforementioned delegation of power, where state governments are given the power to make decisions related to the liquor licensing,” he said.

“I admit recently, there has been confusion on the implementation and enforcement of the licensing for the sale of alcoholic beverages at the state level. 

“I would like to give my assurance that the empowerment given to the states through a gazetted order in 1977 remains without any changes.” 

Tengku Zafrul said he has ordered the Customs Department to take immediate action to update any order or guideline that has been issued to avoid further confusion, with the matter to be resolved by the end of the year. 

“As such, any issue pertaining to the licensing or exemption from licensing is subject to the full power of the state governments.”

Tengku Zafrul was responding to a question from Tony Pua (Damansara-PH) on the government’s initial plan to subject coffee shops to liquor licences, asking how much will be charged on the premises and how this will affect the businesses. 

It was reported on Sunday that coffee shops selling beers had been notified last month through a briefing by the Customs Department of the new licensing policy that will take effect on January 1. 

After drawing flak from various quarters, Transport Minister and MCA president Datuk Seri Wee Ka Siong announced on Tuesday that the government has reversed this ruling, and ordered the Customs Department to do likewise. 

In his supplementary question, Pua said Tengku Zafrul’s explanation today that states are given the power to decide, meant Wee had misled the country when he claimed the licensing requirement had been scrapped. 

“I would like to ask then, why didn’t the Finance Ministry cancel this order altogether, so that no power is passed down to the state governments? And why was the matter discussed in cabinet?” he asked. 

To this, Tengku Zafrul answered that the liquor licensing is under the jurisdiction of the Licensing Board, which was appointed through the delegation of power to state governments, and that any suggestion that the Finance Ministry has revoked this power is false. 

“And as mentioned earlier, there is confusion pertaining to the implementation of licensing at the state level. As such, the Customs Department has been instructed to act immediately to address this.” – The Vibes, December 9, 2021