SMALL businesses nationwide are preparing for a major transition as Malaysia moves towards mandatory e-invoicing.

Beginning July 1, all taxpayers, including micro, small, and medium enterprises (MSMEs) – both brick-and-mortar and online – are required to implement e-invoicing.

While digital transformation is essential for economic progress, many micro-entrepreneurs and small traders face immediate challenges in adapting to the new system.

To ease the transition, the government has exempted physical businesses with annual sales below RM150,000 from e-invoicing requirements.

However, this exemption does not extend to online sellers regardless of their revenue size – a regulatory inconsistency that has sparked concern among industry groups and small business owners.

Towards this end, the Small and Medium Enterprises Association (SAMENTA) has urged the government to raise the exemption threshold to RM300,000, thus aligning it with the official definition of micro-enterprises.

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