Tax reform discussions focus on simplification in the UK and Malaysia

Discussions regarding tax reform and simplification are emerging in the United Kingdom and Malaysia, focusing on economic growth and modernization.

In the United Kingdom, the current tax system is described as overly complex, with a 23,000-page tax code. HMRC estimates that businesses spend over £15 billion annually on tax compliance. Additionally, the cost of administering the system to the public purse rose by 15 per cent in real terms between 2019-20 and 2023-24. Proposals for reform include simplifying corporation tax by replacing marginal rates and allowances with a single 21 per cent rate to reduce uncertainty and encourage investment.

In Malaysia, the government is examining whether features of the Goods and Services Tax (GST) could be integrated into the existing Sales and Service Tax (SST). While the study is seen as a step toward modernizing the system for a digital economy, experts suggest reform should look beyond a hybrid model. Recommendations include addressing tax rules for digital platforms, the gig economy, and crypto asset transactions, while using evidence from the July 2025 SST expansion to guide future implementation.