KUALA LUMPUR – Prime Minister Datuk Seri Anwar Ibrahim has announced a one-year extension of the e-invoicing transition period, sparing companies with annual sales between RM1 million and RM5 million from penalties until 2027.
In his 2026 New Year Message, Anwar also unveiled a series of tax relief measures for micro, small and medium enterprises (MSMEs), including a one-year deferment of service tax on rental for newly established firms.
Previously, business tax exemptions applied to companies with annual turnover between RM500,000 and RM1 million. Anwar said the threshold has now been raised to RM1.5 million, widening the scope of relief.
“We have decided to extend exemptions for MSMEs with annual sales up to RM1.5 million. This is to ease the burden on smaller businesses adapting to new systems,” he said.
The Prime Minister further announced that service tax on rental for MSMEs will be reduced to 6 per cent from the current 8 per cent. The 8 per cent rate, introduced in July 2025, covers non-residential premises such as offices, warehouses and commercial assets.
“The jump from zero to eight per cent was a real problem. For now, I can only reduce it to six per cent, even though this means a revenue loss of nearly half a billion ringgit a year,” Anwar said.
The measures are part of the government’s broader push to ease compliance costs and support SMEs while balancing fiscal pressures. – January 5, 2026