No Plans to Merge Customs and LHDN into Single Tax Agency: Prime Minister

KUALA LUMPUR: The government has no intention of corporatizing and merging the Royal Malaysian Customs Department with the Inland Revenue Board (LHDN) to form a single tax agency, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat.

Anwar, who also serves as Finance Minister, said the administration remains committed to improving governance in the national taxation system to ensure it is efficient, transparent, and compliance-friendly, in line with international best practices.

“At present, there is no decision or plan to implement such an agency,” he said in a written parliamentary reply to Datuk Dr Nik Muhammad Zawawi Salleh (PN–Pasir Puteh).

The question was raised on whether the government intended to merge both agencies and coordinate the national taxation system under the National Single Window framework.

While dismissing plans for a full merger, Anwar stressed that cooperation between LHDN and Customs is being strengthened, particularly in areas of information sharing and enforcement to plug revenue leakages.

He cited several ongoing initiatives, including the e-invoicing system led by LHDN, under which transaction data will also be shared with Customs.

Additionally, both agencies are collaborating on enforcement operations to combat cigarette smuggling and other illicit activities.