Former Economy Minister Datuk Seri Rafizi Ramli has questioned the use of e-Invoicing as a means of combating illegal businesses and organised crime, arguing that enforcement agencies and existing laws should instead be used to tackle criminal activities.
In a social media post, Rafizi said one of the government’s stated reasons for implementing e-Invoicing was to close opportunities for illegal businesses and secret societies, but questioned whether the system had achieved that objective after two years.
“Two years have passed. Look around us. Online gambling has increased. Scams have increased,” he said.
Rafizi said his interactions with the public continued to expose him to victims of scams, adding that whenever he went to the ground, there were people who approached him about having fallen victim to such crimes.
He argued that criminal activity should primarily be addressed through laws and effective enforcement rather than imposing additional administrative requirements on legitimate businesses.
“If there is crime, there are laws. If there are laws, there are police. That is the function of the police — to arrest criminals,” he said.
Rafizi also questioned the rationale of relying on an invoicing system to combat organised crime.
“There is no country in the world that fights secret societies using invoices,” he said.
Rafizi contended that the compliance burden arising from e-Invoicing ultimately falls on legitimate small businesses rather than the criminal organisations the policy is purportedly intended to target.
He cited small traders, grocery shops, workshops and cafés as examples of businesses that have to deal with the requirements despite not being involved in wrongdoing.
“The ones bearing the burden of e-Invoice are not secret societies. Those bearing it are small businesses, grocery shops, workshops and cafés that have never done anything wrong,” he said.
Rafizi maintained that the appropriate response to criminal activities was stronger enforcement.
“The problem of crime should be solved through enforcement,” he said.
Malaysia began implementing e-Invoicing in phases in August 2024, with the system forming part of the government’s wider effort to digitalise tax administration and improve compliance.
The implementation has subsequently been expanded progressively across different categories of taxpayers, while the government has adjusted timelines and requirements for smaller businesses as the system is rolled out more broadly.
Rafizi’s remarks add to the debate surrounding the costs and administrative requirements associated with e-Invoicing, particularly for smaller businesses that may have fewer resources to adopt new digital compliance systems.
His criticism centres on whether tax administration tools should be expected to address criminal activities that he argues fall primarily within the remit of law enforcement agencies.
