4/5/15 12:59 pmMyanmar Tax Law 2015 | Rdl & Partner

Page 1 of 5http://www.roedl.com/locations/asiapacific/myanmar_legal_consulting_tax_consulting_accounting_services/myanmar_tax_law_2015.html

You are here: roedl.com > Locations > Myanmar | Legal consulting, ta... > Myanmar Tax Law 2015

Contact

Jrgen Baur

Phone: +95 1 50 72 36Fax: +95 1 53 86 75E-Mail

Kyaw Swa Myint

Phone: +95 1 50 72 36Fax: +95 1 53 86 75E-Mail

Alternative phone number

Phone: +95 9 25 28 91 012

German dial in number

Phone: +49 (911) 36 06 - 19 68

Chinese dial in numberPhone: +86 21 33 19 19 25

Myanmars new Tax Law of The Union 2015Myanmar has recently enacted the Myanmar Tax Law of the Union 2015. The new tax law was promulgated onApril 2nd 2015 and it will be come into force on April 1st, 2015. The New Tax Law of the Union 2015 providessome important changes from the current legislation, which we list in the following.

I. Commercial Tax

1. Special goodsThe Commercial Tax (CT) rates for the import and production of 16 kinds of special goods will change underthe New Tax of the Union 2015. For example, the CT-rate for the import and production of cigarettes will risefrom 100% to 120% and the CT-rate on tobacco, liquor and beer will rise from 50% to 60%. The CT-rate on jade, rubies, sapphires, emeralds, diamonds and other precious stones will decrease from 30%to 15%. The import and production for respective jewelry will also decrease from 15% to 5%. When these special goods are imported, the tax will be charged on the landed costs. If they are produced inthe country, the tax shall be charged on the sales proceeds.

2. Commercial Tax exempted goods

Under The Tax Law of the Union 2014 84 kinds of goods were exempt from commercial tax. However, in theNew Tax Law of the Union 2015 the number of goods exempt from commercial tax has been reduced to 79.

For example, computers, telephone handsets, soap stocks (oil residue) and fresh and dried animal feed (farmproducts only) are not included under the new draft. On the other hand some additional goods have beenincluded upon the exemption list, such as raw and dried tea leafs, fire trucks and hearse.

4/5/15 12:59 pmMyanmar Tax Law 2015 | Rdl & Partner

Page 2 of 5http://www.roedl.com/locations/asiapacific/myanmar_legal_consulting_tax_consulting_accounting_services/myanmar_tax_law_2015.html

4/5/15 12:59 pmMyanmar Tax Law 2015 | Rdl & Partner

Page 3 of 5http://www.roedl.com/locations/asiapacific/myanmar_legal_consulting_tax_consulting_accounting_services/myanmar_tax_law_2015.html

3. Commercial Tax exempted services

The Tax Law of the Union 2014 exempted 26 kinds of services from commercial tax, whereas in the Tax Law ofthe Union 2015 the number of services exempt from CT has been reduced to 23. Information and technologyservices, technology and administrative consultant services, container transportation services and license withslaughter services are no longer included in the Tax Law of the Union. License fees to be paid to governmentorganizations have been amended to the exempt list.

All services not included in the list are subject to 5% Commercial Tax to be paid on the payment received fortheir services.

Additionally in the New Tax Law of the Union 2015 the construction and selling of buildings are subject to 3%Commercial Tax on sale proceeds.

4/5/15 12:59 pmMyanmar Tax Law 2015 | Rdl & Partner

Page 4 of 5http://www.roedl.com/locations/asiapacific/myanmar_legal_consulting_tax_consulting_accounting_services/myanmar_tax_law_2015.html

4. Commercial Tax on goods for export

The CT rate of exporting jade and other precious raw stones has been reduced from 30% to 15%, and jadeand other precious finished products has been reduced from 10% to 5%.

Additionally Electricity has been added to the list in the Tax Law of the Union 2015 with a tax rate of 8% incase of export.

5. Threshold amounts of CT Exemption

The threshold for CT exemption of Production and sale of goods in Myanmar, as well as Services and Trading inMyanmar got increased under the Tax Law of the Union 2015 from 15,000,000 MMK to 20,000,000 MMK.

II. Income Tax

Personal and corporate income tax rates including basic relief are unchanged under the Tax of the Union Law2015.

However a relief for parents is newly added in the Tax Law of the Union 2015. Provided that theparent/parents live in a common household and are taken care of, the relief on personal income tax is1,000,000 MMK per parent. Also the relief amount for spouse increased from 500,000 MMK to 1,000,000 MMK.Also the relief amount for children increased from 300,000 MMK to 500,000 MMK per child.

The major changes will take place regarding the tax on the income of non-resident foreigners. Under thecurrent tax law non-resident foreigners (individuals residing less than 183 days per year in Myanmar or foreignentities, associations, and organizations including their Myanmar branches) are charged 35% on Myanmar

4/5/15 12:59 pmMyanmar Tax Law 2015 | Rdl & Partner

Page 5 of 5http://www.roedl.com/locations/asiapacific/myanmar_legal_consulting_tax_consulting_accounting_services/myanmar_tax_law_2015.html

sources income. In the Tax of the Union Law 2015 this tax rate has been reduced to 25%, whereas salaryincome of non-resident foreigners is now treated equally to Myanmar citizens and taxed on base of aprogressive rate between 0% and 25%. It should be noted that despite current discussions the Tax of theUnion Law 2015 does not clearly provide whether non-resident foreigners may claim relief such as citizens orresident foreigners.

Besides that, the Tax Law of The Union 2015 states a 25% corporate income tax rate for all companies set upunder MIC and FIL. It still needs to be clarified if this tax rate also applies for Registered Branches andRepresentative Offices.