Malaysia adjusts e-invoicing rollout to support MSMEs

In response to mounting concerns from micro, small, and medium-sized enterprises (MSMEs), the Malaysian government has announced a revised timeline for implementing its nationwide electronic invoicing (e-invoice) system. The decision, made public on June 8, 2025, reflects an effort to ease the digital transition for smaller businesses.

Deputy Finance Minister Lim Hui Ying shared the update during a public event in Penang, where she acknowledged the implementation challenges flagged by the business community. Originally scheduled to take effect on July 1, 2025, for all companies with annual sales of MYR 500,000 (US$118,035) or more, the e-invoice system will now be introduced in additional staggered phases.

Under the revised schedule, companies earning between MYR 1m (US$236,072) and MYR 5m (US$1.2m) will only be required to comply starting January 1, 2026. Those with annual revenues under MYR 1m (US$236,072) will follow six months later, on July 1, 2026. Businesses earning below RM500,000 annually are currently exempt. Meanwhile, larger businesses—those generating between RM5 million and MYR 25m (US$5.9m) — remain on track for the July 1, 2024 rollout as part of the program’s third phase.

Lim emphasized the government’s ongoing commitment to supporting businesses in their digital transformation journey, recognising that smaller firms need additional time to meet the new requirements.

In a related announcement, she also confirmed changes to the enforcement of stamp duty on employment contracts. While previously unenforced, the duty will become mandatory for new contracts starting January 1, 2026. Contracts established before January 1, 2025, will not be subject to this requirement.

The government expressed confidence that businesses will comply with the revised rules under the Stamp Act 1949 and affirmed its dedication to modernizing administrative processes for improved compliance and efficiency