- 5 days ago
- #considerthis
The government has extended the deadline for mandatory e-invoicing for companies with annual sales between RM1 million and RM5 million by another year. The requirement was due to kick in on January 1st, but will now only take effect in 2027. Is this a sensible pause to help businesses adapt, or does it simply postpone the same problems? On this episode of #ConsiderThis Melisa Idris speaks with Dr Chin Chee Seong, National President, SME Association of Malaysia.
Category
🗞
NewsTranscript
00:00Hi, welcome back to Consider This. I'm Melissa Idris. Let's continue our discussion about
00:15e-invoicing. This after the Prime Minister has announced that mandatory e-invoicing for SMEs with
00:23annual turnover of up to RM5 million, it's now been postponed to 2027.
00:28Joining me on the line is Dr. Chin Chi-seong, who is the National President of the SME Association of Malaysia.
00:35Dr. Chin, welcome to the show. Thank you so much for speaking with me today.
00:39Maybe you can start by helping us understand some of the main concerns that SMEs have about the implementation of mandatory e-invoicing.
00:50Thank you for having me here. I think from the SME, from the early beginning when the announcement of e-invoicing,
00:56I think it was very confusing. You know, it's something new that many of the SMEs who don't know what it is all about.
01:03But after a while, you know, more information, they got it. And I think most of them have learned to understand more about
01:11what e-invoicing is good for them and what can they do for them. But among that also, they have concerns, of course.
01:17So the concern of offers into their mind is how much it will cost me, right? How much I'm ready to embark into using the e-invoicing.
01:28Very, very complex. You know, how difficult for me to use it? And will it disrupt my operation?
01:35So these are the major concerns, you know. And of course, the first one I mentioned is the cost.
01:41Implementation cost, right? Even the assurance from LHDN that, you know, there will be no cost, you know,
01:48there will be very minimal, but that is not really true, right?
01:52So when they are trying to assess their own, you know, some of the health accounting system,
01:56so there were various kinds of packaging coming in for them to pay.
02:01Some even charged on transaction-based. So those are the confusion and also the concern,
02:06mainly for them to, you know, embark into this so-called e-invoicing journey.
02:13Could I just interrupt and ask you to explain? So when you say that it's also about cost,
02:21and the IRB, the taxman has essentially said that actually it won't cost much.
02:27Why is there that discrepancy between what they think it will cost and what it actually costs?
02:33So what they mean doesn't cost you is those so-called using their system.
02:39They might be using the system from the IRB, right?
02:42Okay.
02:42And those, mainly for very low transaction and go to manually key in.
02:47And it is sort of quite difficult for those transaction-based,
02:54I mean, the major, the more transaction-based company.
02:58If you have 100 invoices, how could you just key in, you know?
03:01And most of the SMEs that we have now, they already have their own system,
03:06their own accounting system, right?
03:08So the accounting system, for them to integrate, to direct link to the LHDN portal,
03:13because that is where you submit your report automatically.
03:16So when you involve a third party to provide a solution to you,
03:19a plug-in system into your current accounting system, that costs money, right?
03:25And they're also subject to the size of your accounting system that you use.
03:30Whether you have a big accounting space or, you know, your transaction is more,
03:35all subject to the amount.
03:37The smaller company will pay less.
03:39The bigger company, they charge more.
03:41And some of the companies go on transactions, right?
03:43Per transaction, they charge you maybe 1 cent or 2 cent or 10 cent,
03:46you know, all kinds of things.
03:48So that's the cost.
03:49So what LHDN means is that the cost that don't increase,
03:53you use that system and you manually key in,
03:56which I think is in particular for many of us.
03:58Okay, so the real world implementation is actually different
04:02from what IRB or IRB is saying.
04:06So when we think about the delay,
04:08now that the government has granted another year for businesses to be ready,
04:13can you talk to me about what needs to be done meaningfully for SMEs
04:19to address some of their readiness challenges?
04:22How do we make sure that we're not just postponing the same problems a year later?
04:28Yeah, I think the additional year does help SMEs,
04:32but there are a lot of them complaining.
04:34I was having some meeting yesterday with many of them saying,
04:37I just implemented everything, started moving,
04:39and you tell me I don't have to do it.
04:42Okay?
04:43So, Maryam just commented on it.
04:46But anyway, there is at least an option for them.
04:49The option is that whether when they're doing it not right,
04:53then their penalty free period will come in.
04:55This will actually help them.
04:56But to us, for the association point of view,
05:00if those companies have already embarked and also,
05:04I mean, implement a system,
05:05we ask them to go through, just continue.
05:09You don't have to stop it.
05:11But I believe some of them will stop it
05:12because they feel that, you know,
05:14for whatever reason, maybe manpower,
05:16or they want to negotiate for the fees again for the charges,
05:20so they can stop it.
05:21But to me, if they have already paid for it,
05:24just use it.
05:26Right?
05:26Because eventually it will come.
05:27It's just a pause.
05:28Right?
05:29I don't think government will put handbrake and say,
05:31oh, we cancel E-moising.
05:32No way they will do that.
05:34And looking at the size of the company
05:36have already gone into this system,
05:39using the system,
05:39I think it's more than 150,000 companies using it.
05:43In fact, maybe more.
05:44So this is where,
05:45it's a pause that it's not going to implement.
05:50So if you are able to,
05:51if the company is able to,
05:53already invested in it,
05:54just do it.
05:55Right.
05:56And for the companies who haven't been able to get ready
06:00or they're facing challenges in getting ready for this,
06:04what concrete support would SMEs need?
06:07I mean, I'm thinking about grants
06:10or software subsidy
06:11or training capacity,
06:14simplified systems.
06:15I don't know.
06:15What do you think?
06:16What would it take to help?
06:18the ones who are really facing some challenges,
06:20who are really saying,
06:21we don't know,
06:22Can't we deal with this?
06:24How would you help?
06:26I think that it's good that if
06:28government allowed them to have some grant,
06:30I believe there are grants available
06:32and also been given to some of them
06:34under the MDEC,
06:35you know,
06:36digital grants,
06:38a pension grant of 5,000 to 5,000,
06:40maximum of 10,000.
06:41Then I think a lot of them are using those facilities.
06:45But it's sad to say,
06:46they do not have enough allocation
06:48for the coming year.
06:50Right.
06:50If the government can allocate more
06:52for that purpose,
06:53then they will definitely
06:54be a great help to SMEs
06:56who are going to implement e-invoicing.
06:58Also help them to,
06:59I mean,
07:01make an easy way for them
07:02to consider moving on,
07:04even if they are in the borderline.
07:06Say,
07:06let's say,
07:07you say 5 million,
07:07maybe you already do 4.5 million,
07:09for instance.
07:10So,
07:11maybe you should consider
07:12and go ahead with it
07:13if there are any facilities
07:15or grant given to you.
07:17Other than that,
07:18it's probably the training part.
07:19You know,
07:19we have HRD fund
07:21that we can use.
07:22Right.
07:23If we can use a fund
07:24to so-called
07:25get our staff
07:27to go for training.
07:30Right.
07:31Utilizing the funds,
07:32that would be great to help
07:32in front of the cash flow
07:34of the company.
07:35So,
07:36these are the things
07:36that government can really help
07:37because their first few things
07:39I mentioned that
07:40one is,
07:41of course,
07:41at the cost,
07:42the other one will be on the people.
07:44You know,
07:44they want to make sure
07:45that's it,
07:46the person in charge
07:49will know exactly
07:50what to do
07:50so that they can fully comply
07:52with what is required
07:53by LHDN
07:54so that there won't be
07:55penalties
07:55given to them.
07:58Okay.
07:58Do business
07:59that you speak to,
08:01your stakeholders,
08:03your members,
08:03do they see
08:05the benefits
08:06of e-invoicing
08:07or is this
08:08another regulation
08:10compliance
08:11that they feel
08:12like they have been
08:13forced upon them?
08:16I think in the beginning,
08:18everyone was
08:19taking a setback.
08:21Why do I have to implement this?
08:24Why don't you have
08:24a GST system
08:25Can that cater for me?
08:27No need to go
08:27through all this trouble.
08:29But after a while,
08:30they do realize
08:31What is going to happen?
08:33to them
08:33if they don't continue
08:35to see,
08:35especially for those
08:36companies that are
08:36dealing with
08:37multinational,
08:39the big company.
08:39Can you explain?
08:41what consequences
08:43if they don't
08:44adopt this
08:46e-invoicing method?
08:49Many of them,
08:50they don't
08:51keep their records properly,
08:53especially the micro
08:54and the smaller SMEs.
08:56They probably print
08:57an invoice
08:57and collect invoices
08:58and they keep
08:58and file it.
09:00And when they start
09:01growing,
09:02we never know,
09:03one year later,
09:03two years later,
09:04their business
09:04boom,
09:05and they are
09:06doing very well.
09:07And LHCM
09:08will come back
09:09to them
09:09and start audit
09:10on the tax
09:12that they are
09:13not paying properly.
09:14If you don't have
09:15a good record
09:15that you may be
09:16penalized
09:17because you are
09:18supposed to keep
09:19your record
09:19for the past
09:19seven years
09:20for that,
09:21for instance.
09:22So that's where
09:23some of them
09:24don't realize.
09:25It's a small matter.
09:26but when they come
09:27to the problem,
09:28then they will
09:28start complaining.
09:29So we encourage
09:30them to do that
09:31because by using
09:33e-invoicing,
09:33You don't have to worry.
09:34Even when your
09:35next generation
09:36company takeover,
09:37your kids will
09:37know where to
09:38find the data.
09:40Even if they don't
09:40yes,
09:41the government
09:42should have the data
09:43and then there's
09:44no arguments
09:44in terms of
09:45tax payment
09:46or whatever.
09:47So that will
09:48definitely helps
09:48in terms of
09:49sustainability
09:50in terms of
09:51governance
09:51for the company.
09:53So this
09:53long-term thing
09:54It's good.
09:55I fully support
09:56e-invoicing
09:57implementation.
09:58There's no doubt
09:59about it.
09:59But the question
10:00is like what
10:01the government
10:01is trying to do.
10:02They give you
10:02time,
10:03effort,
10:03which is good.
10:04Which is why?
10:04we are supporting
10:05on this.
10:05Okay.
10:06So there's
10:07another year.
10:07There has been a
10:08year of reprieve.
10:09But if we look
10:10back in 2025,
10:11that was a
10:12challenging year
10:13for SMEs.
10:15And the fear
10:17is that 2026
10:18may continue
10:20that trend
10:21of it being
10:22challenging.
10:23What is yours?
10:23outlook for
10:25the year
10:25for SMEs,
10:27for businesses?
10:28Is there anything?
10:28you're keeping
10:29a close eye on?
10:30Yes,
10:32You're right.
10:33You know,
10:332025
10:33is a very
10:34bad year
10:35for everyone,
10:35especially the
10:36SMEs.
10:36Because we incur
10:37so many
10:38costs
10:38and so on
10:39many
10:39announcements.
10:40Every announcement
10:41is not good
10:41for SMEs
10:43community.
10:44So,
10:44but back to
10:45the outlook
10:46of 2026,
10:47I would think
10:47I would be very
10:49Cautiously optimistic.
10:50But we
10:51discipline as well
10:52because
10:52to the fact
10:53that we
10:54believe
10:55and the
10:56government
10:56will start
10:56giving a lot
10:57of goodies
10:57like what
10:58we have
10:59here from
11:00the announcement
11:01PM me.
11:02Also,
11:03today there's
11:03another good
11:04announcement
11:04by us
11:06Mr. Steven
11:06Yes.
11:07He's talking.
11:07about having
11:09more fun
11:10to help
11:10under the
11:12SAPP
11:13to allocate
11:15for the
11:15first time
11:16applicant.
11:17So,
11:17this is where
11:18we are getting better
11:19news that the
11:19government
11:19are looking
11:20into.
11:20So,
11:21I believe,
11:21I strongly
11:22believe that
11:232026
11:23maybe not
11:24be that
11:25good
11:25but will
11:26be
11:26better
11:26than
11:272025.
11:28This is
11:28because
11:29I believe
11:292027
11:31will be
11:31the election
11:32year
11:32and
11:33government
11:34will start
11:34looking
11:35how
11:35to help
11:36and also
11:37not to
11:38lose
11:38their popularity
11:39among the
11:39business
11:40community
11:40because
11:40at the
11:41moment
11:41if you
11:41ask
11:42any
11:42business
11:42community
11:42they
11:43are all
11:43note
11:43happy
11:44with
11:44the
11:45implementation
11:45of
11:46especially
11:47of the
11:47cost
11:48of doing
11:48business
11:48incur
11:49for
11:50all the
11:50SMEs
11:51especially
11:51SMEs
11:52community.
11:52So,
11:53this is
11:54where
11:54they
11:54hope
11:55that
11:55by
11:56this
11:56year
11:56there
11:57should
11:57be
11:57better
11:58right
11:59boots
11:59on the
12:00other
12:00end
12:00look at
12:00the
12:01global
12:01trade
12:01condition
12:02situation
12:02I mean
12:04a lot
12:04of
12:05issues
12:05happened
12:05last
12:05two
12:06weeks
12:06with
12:07Trump
12:08invading
12:08Venezuela
12:09and
12:09all
12:10these
12:10things
12:10have
12:10cute
12:11into
12:11a
12:12great
12:12concern
12:12over
12:13the
12:14economy
12:14outlook
12:15for
12:15the
12:15global
12:16boots
12:17for
12:17us
12:18we
12:18should
12:18start
12:18looking
12:18and
12:19we
12:19hope
12:20that
12:20government
12:20will
12:20help
12:20us
12:21to look
12:21into
12:21ASEAN
12:22and
12:22using
12:23RCEP
12:23to help
12:26us
12:26to deal
12:26with
12:27event
12:27business
12:28among us
12:29in Asia
12:29especially
12:30especially
12:30for
12:31China
12:31so
12:32this
12:32ice
12:32where
12:32I
12:33believe
12:33from
12:33there
12:33on
12:34if
12:35we
12:35really
12:36targeted
12:36help
12:39or
12:39event
12:40those
12:40subsidies
12:40or
12:41event
12:41incentives
12:41or
12:42bring
12:42us
12:42to
12:43go
12:43abroad
12:43by
12:44the
12:44initiative
12:45of
12:45a certain
12:45various
12:46agency
12:47of
12:47the
12:47government
12:47then
12:482026
12:48will
12:49definitely
12:49be a
12:50much
12:50better
12:50year
12:50so
12:51we
12:51hope
12:51to
12:51grow
12:52from
12:53survival
12:53note
12:54need
12:54to
12:54graduate
12:54recovery
12:55boots
12:55also
12:56to
12:56transform
12:56and
12:57make
12:57and
12:58we
12:58have
12:58to
12:59be
12:59depends
12:59on
12:59ourselves
13:00put
13:00it
13:00that
13:00way
13:00right
13:01event
13:01if
13:01there's
13:01nothing
13:02coming
13:02from
13:03the
13:03government
13:04definitely
13:04hope
13:05hopefully
13:052026
13:06will be
13:07a better
13:08business
13:08year
13:08for
13:09everyone
13:09Dr.
13:10Chin,
13:10thank you
13:10so much
13:10for being
13:11on the
13:11show
13:11with me
13:11Dr.
13:12Chin Chi
13:12Day
13:13there
13:13President
13:13of
13:14SMEs
13:14Association
13:15of
13:15Malaysia
13:15wrapping
13:16up
13:16this
13:16episodes
13:17of
13:17Consider
13:17This
13:17I am
13:18Melissa
13:18Idris
13:19signing
13:19off
13:19for
13:19the
13:19evening
13:20thank you
13:20you
13:20so
13:20much
13:20for
13:20watching
13:21and
13:21good
13:21night
13:32to
13:34you
13:34you
13:35you
Be the first to comment