Published on Monday, 26 November 2012 06:33
Out of the 30,606 registered companies, more than 15,000 firms are evading payment of taxes, according to the records of the Inland Revenue Department.
The statistics also show that the tax-to-GDP ratio in Myanmar is at the lowest level among Asean countries.
A total of 15,408 companies have been registered with the Directorate of Myanmar Investment and Company Administration. However, only 10,290 firms reported their income tax.
Among them, only 2,267 companies declared profits while the remaining 8,023 firms showed losses.
The statistics showed that a large number of businesses in Myanmar are evading taxes.
The ratio of tax revenue to GDP in Myanmar is only 3 per cent, according to the report titled “Tax Reform Process” by Aung Moe Kyi, director of Inland Revenue Department.
The report said that tax-to-GDP ratio in Cambodia is 12.7 per cent, increasing three fold compared with Myanmar.
Tax collection in Myanmar is also the lowest among Asean countries.The customs duty rate in the country is only five per cent.
Income-tax collection in the country is also lower than in Singapore and Cambodia.
The financial experts said the reasons for declining state revenue were tax evasion, unregistered businesses, tax reduction, tax holiday and the lack of transparency in using state revenues.
Although the Myanmar government is offering tax exemption to foreign companies as an enticement, they have to pay their countries 40 per cent income tax.
If Myanmar collected 25 per cent income tax from them, they would have to pay their countries only 15 per cent.
Therefore, the tax exemption has only benefited the foreign countries, not Myanmar and the foreign firms.
The report of director Aung Moe Kyi mentioned that some business tycoons are evading payment of tax by approaching high-ranking government officials.
Business Latest News
- Thai event business helps Myanmar kick off SEA Games
- Unilever receives licence to open Myanmar branch
- Construction permits available online by 2014
- Myanmar seizes illegal goods worth Ks 3 billion
- Joint venture to invest Ks 32 billion in stock exchange
- Yangon Stock Exchange to open in two years - Deputy Minister
- Chinese companies to invest in various industrial projects
- Myanmar calls to end illegal timber trade with China
- Myanmar urges China to invest in Kyauk Phyu SEZ
- Six foreign companies receive approval for manufacturing and wood factories