There are 15 types of taxes and duties under four main heads, which are:
• taxes levied on domestic production and public consumption – excise duty; license fees on imported goods; state lottery; taxes on transport, commercial tax and sale proceeds of stamps;
• taxes levied on income and ownership - income tax and profit tax;
• customs duties;
• taxes levied on utility of State-owned properties – taxes on land; water tax, embankment tax; taxes on extraction of forest products, minerals, rubber and fisheries.
Income of tax payer is calculated on the basis of one fiscal year (April 1 to March 31 of the following year). The fiscal year in which income is received is expressed as "income year" and the year following as "assessment year"
A resident foreigner or a resident citizen is subject to tax on all income derived from sources within the Union of Myanmar and on income from sources outside the Union of Myanmar. In the case of an enterprise operating under the Union of Myanmar Foreign Investment Law, the tax is payable only on income derived from sources within the Union of Myanmar.
A non-resident foreigner is subject to tax on all income from sources in Myanmar.
A resident foreigner is:
• a foreigner who lives in Myanmar for not less than 183 days during the income year;
• a company formed under the Myanmar Companies Act or any other existing Myanmar Law wholly or partly with foreign share holders;
• an association of persons other than a company formed wholly or partly with foreigners and where control, management and decision making of its affairs are situated and exercised wholly in the Union of Myanmar.
A foreigner or a foreign organisation who is not a resident in Myanmar is classified as a non resident. A branch company is treated as a non-resident. However, this classification is irrelevant to an enterprise operating under the Union of Myanmar Foreign Investment Law.
A flat tax rate of 30% is applicable to enterprises operating under the Union of Myanmar Foreign Investment Law and those formed under the Myanmar Companies Act.
For a non-resident foreigner (including a branch company), income tax is a payable at 35% or at graduated rates from 3% to 5%, whichever is greater.
The income from salaries other than income of non-resident foreigner the tax is calculated at progressive rates of 3% of 30%.
Payments on income such as interest, royalties and on contracts are subject to withholding tax. There is no withholding tax on dividends, repatriation of branch profits and proceeds from sale of shares and stocks. These items are not considered as forming part of taxable income.
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