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Myanmar: Traders repeat calls for tax reduction
Businesses in jade and gemstone sector have, again, asked for tax reduction, and have set out recommendations for the government with the aim to make Myanmar competitive in gemstone export.
During a meeting last week, the vice president and the minister of the Ministry of Planning and Finance have been requested by various businesses in the jade, gemstone and gold sector to reduce taxes levied in those industries.
Jade and gems are included under special commodities stipulated in the 2017 Union Tax Law.
The businesses asked for the tax on raw jade to be reduced from 15 percent to 10pc, tax on raw gems from 10pc to 5pc and tax on retail of finished products from 10pc to 5pc, Myanmar Gems and Jewellery Entrepreneurs Association (MGJEA) secretary U Hla Tun Aung told The Myanmar Times.
U Yone Mu, MGJEA chair, submitted a letter stating the industry group’s recommendations to the government. The recommendations aim to provide Myanmar an internationally competitive gems export policy, based on an evaluation of existing policies and issues such as high import tariffs and high rates of illegal importation.
Tax collection of the 1pc stamp duty for gold jewellery, stipulated by the 2017 Union Tax Law, has been a success in Yangon and Mandalay. But collection of 5pc tax on pure gold is not going well, and businesses might slip into the black market, Myanmar Gold Entrepreneurs Association secretary U Kyaw Win said.
The amendment regarding commercial tax rates on gold businesses has been discussed in the cabinet and it will soon be submitted to Hluttaw, according to the Union Minister for the Ministry of Planning and Finance U Kyaw Win.
In early May, Myanmar Gold Entrepreneurs Association joint-secretary U Maung Ko had already voiced out the industry’s concern regarding the 5pm tax on pure gold.
“A 5pc tax levy is not found in other countries except the Philippines where the tax rate is 3pc. Gold is not a major commodity in the Philippines, [so] why did they stipulate a law which cannot be found internationally?
“Before becoming developed countries, how did the US, Canada and Australia work with those kinds of laws? We need to know our situation,” U Maung Ko said.
Gold businesses may shut down or might switch to sales in the black market as they cannot afford taxes, hence the expected commercial tax revenues will not be obtained, he added.
Source: http://www.mmtimes.com/index.php/business/26579-traders-repeat-calls-for-tax-reduction.html