Malaysia's gross direct tax collection rises in the first 10 months of 2026
Malaysia's direct tax revenue continued to strengthen in the first 10 months of 2026, with gross collections rising 5.8% to RM174.48 billion. The increase came as the government stepped up tax compliance efforts through the use of e-Invoice data, while also encouraging taxpayers to voluntarily file assessments for previous years.
Highlights
- Malaysia's gross direct tax collections for the first 10 months of 2026 rose from RM164.92 billion to RM174.48 billion, driven by e-Invoice compliance.
- More than 97,000 taxpayers voluntarily filed outstanding tax returns, generating an additional RM1.68 billion in revenue for the government.
- The Inland Revenue Board reported that federal government tax revenue collections rose 9% to RM129.6 billion through June 2026, driven by corporate income tax.
This article was translated from the original. Read the original version by our correspondent here.
e-Invoice compliance supports 2026 collections
As reported by The Edge Malaysia, Prime Minister Datuk Seri Anwar Ibrahim said gross direct tax collections for the first 10 months of 2026 rose from RM164.92 billion a year earlier to RM174.48 billion.He said the increase was supported, among other factors, by efforts to strengthen tax compliance through e-Invoice data. According to him, more than 97,000 taxpayers had come forward voluntarily to file tax returns for previous years, with RM1.68 billion in tax payable.
Anwar, who is also the finance minister, said the implementation of e-Invoice was part of efforts to strengthen compliance and improve the efficiency of the country's tax administration. His speech was read by Second Finance Minister Datuk Seri Amir Hamzah Azizan at the Inland Revenue Board's 2026 Innovation and Integrity Day celebration on Tuesday.
Implications for the government's revenue position
Anwar also expressed his appreciation to all Inland Revenue Board staff for their contribution to strengthening the country's revenue position.Previously, the Inland Revenue Board reported that federal government tax revenue collections rose 9% to RM129.6 billion for the period through June 2026, compared with RM119.1 billion in the same period last year. Deputy Finance Minister Liew Chin Tong was reported as saying that the increase was partly driven by higher corporate income tax collections.
In our earlier report on Malaysia's target of lowering the deficit to below 3% of GDP, we outlined a fiscal consolidation plan that includes targeted subsidy reforms and the digitalisation of systems to improve public spending efficiency. We also emphasised that achieving this target depends heavily on strengthening revenue collection and improving administrative mechanisms, alongside external factors such as oil prices and social spending pressures.
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