Kuala Lumpur: The government has granted an exemption of the e-invoice issuance to small traders with annual sales below RM150,000, benefitting over 700,000 small traders such as hawkers as they no longer need to issue e-invoices, said Finance Minister II Amir Hamzah Azizan.

According to BERNAMA News Agency, the government has also decided to postpone the implementation phase of e-invoicing for micro, small, and medium enterprises (MSMEs) with annual sales of between RM150,000 and RM500,000 to January 1, 2026. This move is intended to provide MSMEs with adequate preparation time. A six-month transition period will also be provided for this group of traders, benefitting over 240,000 MSMEs.

The e-invoicing system’s third phase will commence on July 1, 2025, encompassing all types of businesses, including MSMEs. The e-invoicing programme started on August 1, 2024, for companies with annual sales exceeding RM100 million. From January 1, 2025, the second phase began for companies with annual sales between RM25 million and RM100 million. Since its initiation, 25,173 companies have used the e-invoice system, resulting in the issuance of a total of 181.3 million e-invoices.

During the Dewan Rakyat session, Lim Guan Eng (PH-Bagan) inquired about the possibility of raising the e-invoicing threshold for businesses with an annual turnover of RM150,000 to RM500,000. In response, Amir Hamzah provided the government’s stance and updates on the e-invoicing implementation.

In another discussion, Lim asked about the potential exemption for employers from contributing to the Employees Provident Fund (EPF) for foreign workers to alleviate financial burdens. Amir Hamzah clarified that the mandatory EPF contribution for foreign workers is designed to ensure fairness between local and foreign workers. He explained that without mandatory contributions, the cost of hiring foreign workers would be lower than that of hiring local workers, thus encouraging the employment of more local workers.

Employers making a two per cent EPF contribution for foreign workers can avail of tax deductions on these expenditures, capped at 19 per cent of the total wages of the worker, regardless of citizenship. On February 3, 2025, the government declared that the employer’s contribution for foreign workers would be set at two per cent, with the employee’s share also at two per cent.