E-invoicing threshold raised, tax refunds doubled to support small businesses, says Anwar

KOTA KINABALU (Dec 6): Prime Minister Datuk Seri Anwar Ibrahim has announced the raising of the e-invoicing threshold and doubling the allocation for outstanding tax refunds as reliefs for small businesses.

Anwar said the federal government has agreed to increase the mandatory e-invoicing threshold from RM500,000 to RM1 million in annual revenue, exempting genuinely small operators from immediate compliance.

The decision follows concerns from micro and small enterprises who said the system would increase their costs and administrative burden.

He said larger companies have the capacity to adopt the system without issue, but small traders, particularly those in Sabah, felt pressured by the earlier requirement.

“Small businesses told us this adds cost and complexity. We listened. That is why we raised the threshold to RM1 million.

“The next steps for businesses above that threshold will be reviewed to determine cost implications,” he said at the Sentuhan Madani programme at the Sabah International Convention Centre here.

Anwar, who is also the Finance Minister, stressed that he could not make the announcement during the election period due to regulatory constraints, but instructed his ministry to fast-track the policy review immediately after.

At the same time, he said the government will move to resolve long-delayed tax refunds that have frustrated businesses for years, especially small firms that have complied with payment schedules but struggled to recover excess tax paid.

The Cabinet had initially set aside RM2 billion for outstanding refunds, but Anwar said he has approved an additional RM2 billion to expedite payments, bringing the total to RM4 billion.

“Some traders waited years for money that rightfully belongs to them. This caused real anger. If we demand efficiency from them, we must be efficient in returning what is owed,” he said.

He added that after returning to Putrajaya and reviewing the records, the complaints raised by Malay and Chinese business communities alike were valid.

“The government must respond swiftly. I don’t want traders, especially the small ones, to keep waiting,” he said.

The Prime Minister stressed that both decisions reflect the government’s commitment to practical economic reforms shaped by ground realities rather than rigid bureaucracy.