SAMENTA Welcomes E-Invoicing Postponement – SME & Entrepreneurship Magazine
The association also calls for the threshold to be raised to 300,000
The Small and Medium Enterprises Association of Malaysia (SAMENTA), has welcomed the government’s decision to postpone Phase 3 of the e-invoicing implementation to 1 January 2026, describing it as a crucial relief for SMEs.
According to SAMENTA national president Datuk William Ng, this postponement grants an additional six months for approximately 240,000 SMEs that were initially required to adopt e-invoicing by July 2025.
He said that since the beginning of the year, SAMENTA has observed a significant increase in SMEs seeking technical assistance and training related to e-invoicing. The extended timeline, he noted, will enable SAMENTA to better support SMEs in navigating the transition.
Ng also expressed appreciation for the government’s partial adoption of SAMENTA’s recommendation by exempting small traders from issuing e-invoices.
However, he strongly urged the government to raise the exemption threshold to RM300,000, aligning it with the official definition of micro-enterprises, noting that increasing the threshold would exempt an additional 70,000 SMEs, thereby raising the total number of exempted businesses to 770,000.
While acknowledging that the delay is beneficial, Ng cautioned that many small traders still face significant challenges in implementing e-invoicing due to financial constraints, limited education, and a lack of technical expertise.
He said that a substantial number of businesses have already indicated their intention to shut down by 1 July 2025, citing factors such as ageing business owners, shrinking profit margins, and the steep learning curve associated with e-invoicing.
He added that some SMEs within the supply chains of larger corporations have voluntarily adopted e-invoicing ahead of schedule. In light of this, he proposed that the government revisit the exemption threshold in 2028, by which time the e-invoicing system would be more established, and transition costs would be lower and more manageable for SMEs.
Yesterday, the Malaysian government announced a deferment of Phase 3 of its e-invoicing implementation, shifting the deadline from July 2025 to 1 January 2026. This decision follows mounting concerns from businesses, particularly SMEs, regarding their readiness for compliance.
The Ministry of Finance and the Inland Revenue Board (IRB) acknowledged the challenges faced by SMEs, including cost barriers, limited technical know-how, and the need for additional training to facilitate a smooth transition.
E-invoicing, a digital invoicing framework designed to enhance tax compliance and business efficiency, was initially slated for implementation in three phases. The latest postponement applies to SMEs with annual turnovers of RM100 million or less, a move that seeks to alleviate pressure on business owners who are still adapting to digital tax reporting mechanisms.
While larger corporations have been mandated to adopt e-invoicing earlier, the extended timeline provides SMEs with the opportunity to familiarise themselves with new systems and ensure a seamless shift.
Industry leaders and business associations, including SAMENTA, have been advocating for greater flexibility in the rollout of e-invoicing.
Many businesses argue that the transition requires significant investment in digital infrastructure, which remains a challenge for smaller enterprises. The latest deferment is seen as a positive step towards achieving broader compliance while safeguarding SME sustainability.
