Once the company registration is completed, the Taxpayer Identification Number (TIN) is provided. Using the TIN, any kind of tax that includes but not limited to corporate tax (after the tax exemption period is over), commercial tax, and withholding tax, can be paid online.
In order to pay online, the company needs to have an account with a member bank of the Myanmar Payment Union’s (MPU) e-commerce system. As of 2015, Asia Green Development Bank (AGD), Aya Bank (AYA), Cooperative Bank (CB), Kanbawza Bank (KBZ), Myawaddy Bank (MWD), United Amara Bank (UAB) are member banks. Please check with the Thilawa SEZ Management Committee regarding new member banks. There is a link at the Thilawa SEZ webpage hyperlinked to the online tax payment gateway of the Internal Revenue Department.
Based on the recruitment status report submitted by each company on monthly basis, the General Index Registration Number (GIR) is issued for individual employees. The Personal Income Tax of each employee is to be deducted by the company from his/her salary and to be paid through the Front Office of OSSC. The progressive rate system is applied for Personal Income Tax and the rates can be seen in this section. The One Stop Service Center of the Thilawa SEZ welcomes for further clarifications.
The free zone investors are exempted from the commercial tax; however, non-free zone investors are exempted from the commercial tax for five years from the date when their commercial operations commence. Hence, non-free zone investors need to pay commercial tax for land lease. The import duties (that include commercial tax) for the importation of duty-free products (such as machinery, equipment, construction material, etc.) are exempted for both free zone and non-free investors. However, import duties for the importation of raw materials are exempted for free zone investors but not for non-free zone investors. The detailed explanation table regarding what types of tax are exempted or not exempted for the developer or free zone investor or non-free zone investor can be downloaded from the Thilawa SEZ website.
The commercial tax is to be paid on monthly basis and have to be paid within 10 days after the end of the concerned month and the stamp duty is to be paid on the date of the signing of a contract or agreement. There will be a fine for late payment. The commercial tax is mandatory; however, the stamp duty is not. However, a contract or agreement without having a stamp duty paid and without having it registered is not enforceable at the court in Myanmar. As per the Myanmar Special Economic Zone Law, an investor can choose any country for the event of arbitration and this needs to be clearly stated in the contract. If it is not included in the contract or agreement, arbitration has to be in Myanmar and be compliance with the Myanmar law.
Necessary procedures related to Tax Registration are summarized as follows;
- The Investor shall apply for Business Taxpayer Identification Number (TIN) for Company and Commercial Tax Registration to Internal Revenue Department Section of OSSC through the Front Office of OSSC as soon after obtaining Company Registration and opening the bank account.
- As for the personal income tax for each employee, firstly, the Investor shall submit a list of employees with the Form of Recruitment Status, which is provided in Notice No.02/2015 of Thilawa Special Economic Zone Management Committee dated 8 July 2015, and with the standard Employment Contract it uses, to the TSMC. Subsequently, the Investor may apply for the General Index Registration Number (GIR) on behalf of each employee to the Internal Revenue Department Section of OSSC through the Front Office of OSSC. Regarding the personal income tax to be paid for the salary income, each individual employee does not need to pay with his/her GIR because the personal income tax is to be deducted by the company from the salary payment and is to be paid by the company with its TIN on behalf of the employee.
- The land lease contract between the Investor and the MJTD shall be stamped for legality and validity. Therefore, the Investor shall submit the copy of land lease contract which was already negotiated to the Internal Revenue Department Section of OSSC through the Front Office of OSSC and makes necessary payment through a bank. After completion of the payment, the Internal Revenue Section to put a stamp to the original land lease contract before signing the contract.
- The “tax return” of a company has to be submitted to the taxation section of the OSSC by the end of June of the following year. (i.e. the tax return for 1st April to end of June).
The tax registration procedures can be downloaded from the following link.