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Tax Considerations in Myanmar

The Internal Revenue Department (IRD), Ministry of Planning and Finance, is the main tax administrator and Myanmar is ranked 125th in a ranking of 190 economies in the World Bank’s 2018 Doing Business report on the ease of paying taxes. The principal taxation law of Myanmar can be viewed on IRD’s website.

An overview of the major types of taxes levied in Myanmar is provided in the table below. Other taxes may also be applicable such as stamp duty. Myanmar and Hong Kong do not have a double tax agreement in place, although they have recently negotiated an Investment Promotion and Protection Agreement (IPPA).

Tax

Scope

Rate

Corporate Income Tax

Resident companies are taxed on worldwide income. Non-resident tax companies are taxed on income derived from sources within Myanmar.

A resident company is a company formed under the Myanmar Companies Act 1914 or any other existing law of Myanmar. Generally, foreign branches are deemed to be non-resident companies.

25%

Withholding Tax

Under current practice, tax collection from a non-resident foreigner is obtained by way of a withholding tax mechanism. It applies on interests, royalties and payments made under contracts/agreements.

2% to 15%

Personal Income Tax

Myanmar residents are taxed on worldwide income. Foreigners who reside in Myanmar for 183 days or more during an income year are considered tax-resident foreigners, as well as foreigners working for companies set up under existing Myanmar laws.

Non-resident foreigners are taxed only on income derived from sources within Myanmar.

No tax is payable if total income does not exceed MMK4.8 million (about US$3,500) in a year.

0% to 25%

Commercial Tax

Tax imposed on the sales proceeds of certain commercial transactions.

0% to 8% (5% standard rate)

Special Goods Tax

Introduced from April 2016 on a list of special goods with the intention that the commercial tax will be phased out. This tax applies to goods including cigarettes, alcoholic beverages, gems stones, teak, vans, certain cars and certain fuels.

5% to 120%

 

A Practical Guide to Doing Business in Myanmar

  1. Regulatory Environment
  2. Establishing a Presence
  3. Intellectual Property Protection
  4. Staff Recruitment
  5. Tax Considerations
  6. Import/Export Procedures
  7. Further Information


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