KUCHING: Property developers are calling for a higher exemption threshold for businesses with regard to e-invoicing requirements.
The Sarawak Housing and Real Estate Developers’ Association (SHEDA) made the call in welcoming the federal government’s
decision to exempt businesses with an annual turnover of up to RM150,000 from e-invoicing requirements.
Also its decision to extend the implementation deadline for micro, small, and medium enterprises (MSMEs) earning between RM150,000 and RM500,000 by six months.
Sheda adviser Datuk Sim Kiang Chiok urged the government to further ease the transition by raising the exemption threshold from RM150,000 to RM500,000.
He pointed out that many micro and small traders would struggle with the additional costs of compliance, and an increased threshold would provide much-needed relief.
“The introduction of e-invoicing in Malaysia aims to enhance transaction transparency and reduce tax evasion, ultimately strengthening financial reporting integrity and improving tax collection efficiency,” he said in a statement.
Sim noted that in the development and construction sector, e-invoicing would apply to various processes, including progress billing to purchasers and claims by contractors and suppliers.
While larger companies could adjust to the change, he expressed concern that smaller contractors and suppliers might face difficulties due to their limited accounting and administrative capacity.
“E-invoicing will inevitably increase business costs and reduce flexibility in tax reporting.
“Given this, there is a growing demand from small and micro-businesses for higher exemption thresholds, particularly for those earning above RM150,000,” he said.
As such, he suggested that the threshold be raised to RM500,000 or even RM1,000,000 to better support businesses that may struggle with financial and operational challenges during the transition.
He stressed that while e-invoicing is an important step in improving tax compliance, the government must take a balanced approach to ensure that smaller enterprises are not unduly burdened.
“A higher exemption threshold will help sustain their operations and enable them to continue contributing effectively to Malaysia’s economy,” he added.
The government has set January 1, 2026, as a key date for the implementation of e-invoicing, but it specifically applies to small and medium enterprises (SMEs) with annual sales between RM150,000 and RM500,000.
This group will have a six-month transition period following the implementation date.
Businesses with annual sales below RM150,000 are exempt from e-invoicing requirements.
The full implementation for all businesses is planned for January 1, 2027.
