The government had proposed levying a 3 percent tax on income not included in the bill that was submitted within the first half of the fiscal year and 5pc for income submitted within the second half of the year.  The Joint Bill Committee is now suggesting a third tax bracket for such income. 

The first category of income has been identified as income from a foreign business source by a local or foreign residing citizen that avoided assessment or the taxes paid was less than what is due. The suggested tax rate for this category is 3pc for the first half of the fiscal year and 5pc for the second half.

The second income category is defined as money deposited in the banks and invested in the stock market. The tax rate is 5pc for the first half and 7pc for the second. 

“This will be taxable as the money earned will circulate within the economy,” said U Aung Min, chair of Pyithu Hluttaw Public Account Committee.

The third income category is defined as income generated from immovable properties including land and houses, movable properties like vehicles, gold and other valuable assets and tangible and intangible goods that are bought, constructed, acquired or invested in. The tax rate will be 7pc for the first half and 10pc for the second half.

“However, these are just suggestions for now and they are not approved yet. The other Members of Parliament will discuss it,” U Aung Min said.

Meanwhile, the Joint Bill Committee has also suggested raising the minimum threshold for taxable income to relief the tax burden on government employees and private sector workers.  

“While the bill states the minimum taxable income is K48 lakh per year, our suggestion is to raise it to K 50 lakh per year. This implies that the tax relief on income up to K 4 lakh per month will be extended to K 5 lakh per month,” U Aung Min said.

 “The government is raising efforts to identify and levy taxes on as many sources as possible. This is not the first time we are levying taxes on income not originally included in the tax bill for the year. It was done before in 2004 and 2007,” he added.

To avoid missing out on taxable income and maximise tax revenues, the Ministry of Planning and Finance is in the midst of drafting a new income tax law and U Aung Min hopes it will be stipulated within this fiscal year. The law aims to encompass all sources of income and taxes will be levied appropriately. 

Source: https://www.mmtimes.com/news/parliament-suggests-tax-rates-non-assessed-income.html