Yangon chief minister to strengthen tax system

The Yangon Region chief minister has outlined plans to strengthen the city’s taxation system by examining weaknesses in local business audits.

During a meeting with industrial zone officials on April 25, U Pyo Myo Thein said that businesspeople never show their audits to tax officials.

“We need to make sure their audits are reliable,” he said.

The National League for Democracy-led government set out its budget and taxation policies for the current fiscal year in January.

Once the government has educated people in Yangon Region, reform will follow, said U Pyo Myo Thein. “Yangon Region is the most developed area in Myanmar and is the largest consumer – for example it uses around 50 percent of the country’s electricity supply,” he said.

The government has found that businesspeople often commission more than one audit of their companies, keeping the real one and presenting a false or doctored audit showing lower profits to tax authorities.

Substitute audits detailing higher profits are used for deals with foreign partners or for taking out bank loans, sources said.

U Than Zaw Win, director of the Internal Revenue Department in Nay Pyi Taw, said his office would urge tax payers to report reliable audits.

At the Large Taxpayer Office (LTO), established in 2014, taxpayers must make a self-assessment. A self-assessment system will also be set up for small and medium-sized businesses if their reports become reliable, he said.

“Some small businesses said they don’t have audits. Therefore, we impose taxes on them as we see fit, though sometimes they think the amount we charge is too high,” he said. In such cases, the company has a right to appeal.

The tax office typically assumes companies have under-reported income and treats their statements as unreliable, said the finance officer of a private company who has worked with the LTO. It also often warns companies against this and outlines punishments, she said.

“But businesspeople always under-report their profits, or they would be unable to compete with competitors who do not pay regular taxes.”

Tax laws for the 2016-17 fiscal year seem to have made things more complicated for citizens rather than focusing on examining tax-dodgers, she added. U Aye Thaung, chair of Shwe Lin Ban industrial zone, said the government should offer incentives to tax payers, such as offering to solve infrastructure problems such as electricity, water and logistics for local manufacturers.

“We think our money is clean if we earn it honestly, but the government disagrees, as long as we don’t pay tax. First we will have to change this mindset, and the government must tackle corruption and facilitate procedures for tax payers,” he said.

Source: The Myanmar Times

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, “Puma Energy”, “MOGE”, “yangon new town”,”MECTEL”, “hydropower”, etc.

.

Looking for foreign investors to invest in your business in Myanmar