On 17 June 2020, the Ministry of Planning, Finance, and Industry (“MOPFI”) issued Notification No. 65/2020 (“Notification 65”) which outlines additional forms of tax relief that can be availed by businesses affected by the COVID-19 pandemic in Myanmar. This Notification is issued in line with the fiscal stimulus provided under Myanmar’s COVID-19 Economic Relief Plan and the President’s Executive Order Concerning the Union Tax Law as recently issued on 12 June 2020.
The following are the tax reliefs that are available to businesses in Myanmar under the Notification:
- 10% non-refundable tax credit for incremental wages and salaries
- 125% deduction for incremental wages and salaries
- 10% non-refundable tax credit for incremental investments on capital equipment
- 125% depreciation for incremental investment on capital equipment
Notification 65 is a welcome development as it provides corporate taxpayers with additional tax relief to help them mitigate the ongoing economic impacts caused by COVID-19 and the disruption to everyday life that is making commercial activities difficult for everyone. The tax relief provided by Notification 65 encourages companies (especially labor-intensive and capital-intensive businesses) to capitalize on people by incentivizing the company to hire, maintain and avoid laying off employees, and to invest in capital equipment by incentivizing companies to make additional capital expenditures at lower applicable tax during the COVID-19 pandemic.
If you have any questions or wish to know more about the topic, please do not hesitate to contact us.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.
Partner & Head of the Regional Tax Practice Group
Senior Tax Manager, Myanmar