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Challenges in Indirect Tax Administration: Building Transparency and Trust in Malaysia’s SST System: A Policy Review Paper

Author

Listed:
  • Fatin Nurashyatul Elia Rosli

    (Faculty of Accountancy, Universiti Teknologi MARA, Cawangan Selangor, Kampus Puncak Alam, Selangor, Malaysia)

  • Nuridayu Yunus

    (Faculty of Accountancy, Universiti Teknologi MARA, Cawangan Selangor, Kampus Puncak Alam, Selangor, Malaysia)

Abstract

This paper examines the challenges in Malaysia’s indirect tax system, particularly the transition from the Goods and Services Tax (GST) to the Sales and Services Tax (SST). The shift created confusion among businesses and consumers due to unclear communication, administrative inefficiencies, and inconsistent enforcement. Public concerns over fairness, equity, and corruption further weakened trust in the system, while businesses, especially SMEs, faced high compliance costs and operational burdens. Drawing on the issues identified, the study emphasises the importance of improving transparency, simplifying compliance procedures, strengthening anti-corruption measures, and ensuring consistent enforcement. These reforms are crucial to restoring public confidence, promoting voluntary compliance, and sustaining government revenue collection. The paper concludes that fostering trust between tax authorities, businesses, and the public is essential for the long-term effectiveness and fairness of Malaysia’s indirect tax administration.

Suggested Citation

  • Fatin Nurashyatul Elia Rosli & Nuridayu Yunus, 2025. "Challenges in Indirect Tax Administration: Building Transparency and Trust in Malaysia’s SST System: A Policy Review Paper," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(9), pages 2382-2390, September.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-9:p:2382-2390
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    References listed on IDEAS

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    3. Jimenez, Peggy & Iyer, Govind S., 2016. "Tax compliance in a social setting: The influence of social norms, trust in government, and perceived fairness on taxpayer compliance," Advances in accounting, Elsevier, vol. 34(C), pages 17-26.
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