country report (myanmar)
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Country report (Myanmar)
Presented by
Kyaw Ye' Tun
Assistant Director
Internal Revenue Department
Ministry of Finance and Revenue
Introduction
Situated in South East Asia
North & northeast - China
East & southeast - Laos & Thailand
South - the Andaman Sea
& the Bay of Bengal
West - Bangladesh & India
Introduction (Continued)
Total land area - 676,000(s) kilometers
From east to west - 936 kilometers
From north to south - 2051 kilometers
In the tropical monsoon zone
Three seasons
- the hot season (March to May)
- the raining season (June to October)
- the cold season (November to February)
Total population - 59.13 million
Ethnic groups - 135
Predominant language - Myanmar
Main religion - Buddhism
Full freedom of worship for other religions
Rich in natural & human resources
Need capital & high technology in every field
Introduction (Continued)
Myanmar tax policy
Based on the following objectives:
- To raise resources to finance government
expenditure
- To attain a balance budget
- To check economic inflation
- To coordinate domestic consumption,
investments and savings
To reduce the wealth gaps between the rich
and the poor
To discourage the consumption of some
commodities
To achieve other desirable goals
To invite participation in terms of technical
know-how and investment from sources
inside the country and abroad
Myanmar tax policy (continued)
Taxes & duties administered by IRD
(kyat in billion)
2004-05 2005-06 2006-07 2007-08 2008-09 2009-10
State
revenue298.502 472.178 724.976 896.241
1063.585
1098.030
IRD tax
collection
265.186
88.84%
448.156
94.91%
676.774
93.35%
838.391
93.55%
987.925
92.88%
1037.364
94.47%
Taxes & duties administered by IRD (continued)
Composition of tax revenue from(2004-05)to(2009-10)
(kyat in billion)
Profit Tax
Tax on income Kind of tax for self-employed individuals Resident citizens not being salary or wage
earners Association of person not being companies Not cover by income tax law, subject to profit
tax law Minimum income liable to tax is K 10,000 Income from production of goods or transport
services the tax payable is 10% less
Income from production of cheroots 10% more
If income exceed K 300,000,
tax payable = 146703+50% of amount
exceeds K 300,000
Tax payable based on 50 income level
Capital gains – 10% flat
Prepare to repeal this profit tax law after
Constitution comes into operation
Profit Tax
Supplement by Income tax rules, regulations,
the state budget law and notification issue
from time to time State economic enterprises, salary earners,
firms, companies, association of person Total income from in and outside Myanmar Nonresident foreigner for the income
received in Myanmar Comprises corporate income tax, individual
income tax, capital gain tax and withholding tax
Income Tax Law (1974)
Depreciation Allowance
Building - 1.5% to 10%
Furniture and fitting - 5% to 10%
Machinery and plant - 5% to 10%
Machinery equipment - 2.5% to 20%
Waterway transport - 5% to 10%
Road transport vehicles - 12.5% to 20%
Miscellaneous - 10% to 20%
Deduction
The persons who are responsible for
salaries income: The Head of Government organization The owner of enterprise Association of persons, a member of
management The president or the secretary, for co-operative
society General manager or manager of a company
Withholding tax Resident Non-
Resident Foreigner
Foreigner(a) interest - 15%(b) royalist for use of license, trade marks patent rights 15%
20%(c) Gross income (Receipt) from contracting works done for state organizations development committees,
and Co-operatives societies 3% 3.5%
(d) Receipt from contracting work 2.5% 3%
Rate of the income tax
Resident Foreigner;
(i) A foreigner who resides in Myanmar for not
less than 183 days
(ii) A company formed wholly or partly with
foreign share holders
(iii) As association management and decision
making of its activities wholly in Myanmar
Non-Resident Foreigner; is not a resident
foreigner in Myanmar.
The income from salary: salary, wages,
annuity, pension, gratuity and fees, etc:
Profession: a doctor, a nurse, a lawyer, an
Engineer, an architect, a film artiste, etc:
The Capital Gain: profit realized from the
sale, exchange, or transfer of capital asset.
Capital asset: land, building vehicle and
any capital asset connected with the business.
Rate of the income tax
Resident Non-Resident
Foreigner Foreigner
(a) Salary 15% 35%
(b) Capital gains other than
oil and natural gas sector 10% 40%
(c) Income from other than
salary 30% 35%
Rate of the income tax
Avoidance of Double Taxation agreements
(a)United Kingdom
(b) Malaysia
(c) Singapore
(d) Vietnam
(e) Thailand
(f) Korea
(g) Bangladesh
(h) Indonesia
(i) India
Commercial Tax
A turnover tax, like VAT or sale tax.
(a) Goods produced within the state and sold
domestic and abroad,
(b) Goods imported from abroad,
(c) Services rendered within the state.
There is chargeable to pay tax only on 10
kinds of services rendered within Myanmar.
Commercial Tax
Schedule 1 list item of goods exempt from the
tax, 5% for Schedule 2 list items of goods, 10%
for Schedule 3, 20% for Schedule 4, 25% for
Schedule 5 and Schedule 6 represents specific
types of goods ranging from 30% to 200%.
Pay tax in foreign currency:
(i) any commodity (Schedules 1 to 6 of
Commercial Tax Law) rate of 8% (not
including export sale of CMP);
Commercial Tax
(ii) 9 kinds of services, the foreign currency
includes in the receipts, prescribed rates
according to the type of services.
(iii) In border trade, the goods are imported
from abroad, the commercial tax, will be
levied with the currency used in import
transaction.
15 types of taxes and duties under the 4 major
head namely -
(a) Taxes levied on production &
consumption
(b) Taxes levied on income and ownership
(c) Customs duties
(d) Taxes levied on the utility of state own
properties
Myanmar tax structure
Taxes levied on domestic production and public consumption Excise duty - General Administration
Department Commercial Tax - Internal Revenue
Department License fees on - Customs Department imported goods State Lottery - Internal Revenue
Department Taxes on transport - Road Transport
Department Sale proceeds of stamps - Internal Revenue
Department
Myanmar tax structure
Taxes levied on income and ownership
Income Tax - Internal Revenue
Department
Profit Tax - Internal Revenue
Department
Customs Duties
Customs duties - Customs Department
Myanmar tax structure
Taxes levied on utilization of State owned properties Taxes on land - General Administration
Department Water tax and - General Administration embankment tax Department Tax on extraction of - Forest Department forest products Tax on extraction of - General Administration mineral Department Tax on fisheries - Fishery Department Tax levied on rubber - Forest Department
Myanmar tax structure
Trying to introduce self-assessment system
Preparing establishment of integrated network
systems
To raise the rate of taxpayer’s compliance
Promote solidarity, mutual amity and mutual
assistance among the ASEAN Nations
Conclusion
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