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The Republic of the Union of Myanmar The Republic of the Union of Myanmar

The Republic of the Union of Myanmar - PowerPoint Presentation

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The Republic of the Union of Myanmar - PPT Presentation

Ministry of Planning and Finance Internal Revenue Department MYANMAR TAX SYSTEM REFORM Tobacco Taxation in Myanmar Khin Yamon Aung Director IRD Ministry of Planning and Finance Tobacco Taxation ID: 591348

tax tobacco myanmar specific tobacco tax specific myanmar cheroot goods sgt reform union 2016 cigarette state kyats charged ministry smoking program planning

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Slide1

The Republic of the Union of Myanmar

Ministry of Planning and FinanceInternal Revenue Department

MYANMAR TAX SYSTEM REFORM

Tobacco Taxation in Myanmar

Khin

Yamon

Aung

Director, IRD, Ministry of Planning and Finance

Tobacco Taxation

,

Washinton

DC,18-19 April, 2017Slide2

The

Republic of the Union

of Myanmar

The Land

The largest country on the main land of

South East Asia

Capital : Nay Pyi Taw

Total land area 676,577 sq. km (216,228 sq. miles)

Neighboring countries:Bangladesh, India, China, Laos, Thailand

Total coastal line

2,832 km

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KACHIN STATE

CHIN

STATE

SHAN STATE

KAYA STATE

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SAGAING

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MAGWAY

DIVISION

BAGO

DIVISION

YANGON

DIVISION

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CHINA

LAOS

THAILAND

INDIA

BANGLADAHS

Population

51 millions

Religion

Buddhism

(89.3%)

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Christians (5.6%),

Islam (3.8%)

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Hindus (0.5%),

Animism (0.5%)Slide3

Reform ProgramReform Program commenced in 2012 with an IMF Mission.

This set out a very ambitious reform agenda.Now Myanmar is on the way of 2nd phase of reform journey. Along the first phase reform program, Specific Goods Tax (SGT) introduced in 2016.Before 2016, Myanmar didn’t levy specific tax for tobacco products but levy Commercial Tax and Income Tax3Slide4

During that time, the cigarette was charged at 100%,And other tobacco products including Cheroot were charged at 50%.Myanmar introduced a Specific Goods Tax (SGT), effected from 1st

April 2016.SGT is imposed on Importation of Specific goods into Myanmar,production of specific goods in the country andexportation of specific goods abroad.4Slide5

importers, producers and exporters of specific goods are subject to paying SGT.There are 17 types of specific goods including all sort of tobacco products.(Cigarettes, Tobacco leave, Virginia tobacco, cured, Cheroot, Cigars, pipe tobacco and Betel quid preparations)

SGT rates are published in the Union Tax Law approved by the Union Parliament.5Slide6

Mixing specific and ad valorem rates are appliedTobacco and Virginia tobacco are taxed at 60 %, Cigars, Pipe Tobacco and Betel quid preparation are charged at 80%.all types of cigarettes are charged SGT based on the price range.

There are 4 tiers, The highest tier is 16 Kyats per stick for the ex-factory price 800 kyats and above per pack.25 cents per pack.6Slide7

tax collection increased significantly.In Fiscal Year 2015-16, 16 billion kyats.In 2016-17, increased to 48 billion

kyats.300% increased.IRD plans to reduce tiers for Cigarette under SGT.Applying Single tier is not possible due to enforcement constraint.gradual reduction of tiers is under consideration. 7Slide8

Cheroot in MyanmarSlide9

Cheroot, to apply a mix type of specific and ad valorem system.Smoking Cheroot is above 50 % of smoking volume.Traditionally, rural people prefer to Cheroot than Cigarette.Starting from 2017, Cheroot is subject to SGT 0.5 Kyat and 1 Kyat per stick based on the price.Slide10

tax stamp system on Cigarette as a production control measure.Like Cigarette, Cheroot will be use tax stamp in futureMyanmar is trying to reduce the smoking and consumption of Tobacco product with the collaboration with Ministry of Health and other ministries

enforcement of Tobacco Control Law 2006Specific Goods Tax Law 2016.In conclusionSlide11

Thank you for your attention

Ministry of Planning and FinanceThe Republic of the Union of Myanmar