Malaysia steps up SME support, regulates foreign e-commerce platforms

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Highlights

The Malaysian government is tightening regulation of foreign e-commerce, requiring local registration and compliance with standards, with an e-commerce bill set to be tabled in the Dewan Rakyat.
A 10% sales tax applies to low-value imported goods, narrowing the tax gap between imported and local products and setting out the tax treatment of online businesses.
A total of RM8 billion has been allocated for technical and vocational education and training, while the Bakat Madani programme aims to create 30,000 new job opportunities for young people by 2027.

This article was translated from the original. Read the original version by our correspondent here.

Financing support and regulatory framework

As reported by The Edge Malaysia, Second Finance Minister Datuk Seri Amir Hamzah Azizan said financing facilities under Syarikat Jaminan Pembiayaan Perniagaan Bhd (SJPP) are available to entrepreneurs in Sabah, including those operating in industrial areas. Applications for SJPP financing can be submitted through 23 financial institutions, subject to their respective requirements and credit assessments.

He said the government is also considering legislative and enforcement measures to protect the interests of local SMEs and ensure that foreign e-commerce companies operating in Malaysia are regulated. He said an e-commerce bill would be tabled at the next Dewan Rakyat sitting to strengthen oversight of online sellers.

Under the measures, foreign e-commerce platforms selling to consumers in Malaysia must register as local businesses. They must also ensure that the products they sell comply with local regulations and safety standards, including SIRIM certification, to protect consumers.

Impact on competition, taxes and the workforce

Amir Hamzah said the 10% sales tax on low-value goods imported from abroad helps narrow the tax treatment gap between imported goods and locally produced products. He added that income from online businesses is subject to income tax in the same way as conventional businesses, while the tax treatment of foreign service providers depends on the type of payment and the relevant double taxation agreements.

In talent development, he said these efforts must go hand in hand with investment. A total of RM8 billion has been allocated for technical and vocational education and training, while Bakat Madani aims to create 30,000 new job opportunities for young people in 2027.

He also said tax deductions are available for approved training to encourage employers to upskill their workers. Amir Hamzah also noted that Sabah recorded the highest number of Amanah Ikhtiar Malaysia participants, at around 53,000, demonstrating that the state remains a key focus for entrepreneurship support initiatives.

In our earlier coverage of coordinated enforcement concerning the entry of products and businesses by foreign entities, we explained the government’s efforts to establish an inter-ministerial working committee to examine competition issues and pressures on local SMEs. The article also discussed the focus on drafting the e-Commerce Bill and initiatives to promote local products, such as standardising the “Jom Beli Produk Malaysia” logo and the Jom Malaysia programme to bring SMEs onto digital platforms.

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