Malaysia’s tax revenue has surpassed RM200 billion for the first time in 2025, driven by stronger enforcement, improved compliance, and the rollout of e-invoicing that is identifying previously undeclared income.
In this interview, Soh Lian Seng, Head of Tax at KPMG in Malaysia, explained the system has flagged over 500,000 potential tax leakage cases, including widespread underreporting, while also reshaping taxpayer behavior through a strong deterrent effect. He added that while part of the increase reflects one-off recovery effects, sustained revenue growth will hinge on stronger compliance, policy stability, and continued digitalization rather than higher tax rates.
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