MPs state that the current tax system is not working and is outdated.Â
Taxes are in the spotlight once again. At the end of last year the Myanmar Construction Entrepreneurs Association (MCEA) called upon the Ministry of Finance and Planning and the Internal Revenue Department to decrease taxes for homebuyers in a bid to help give the market a boast.
Now MPs in Myanmar’s capital, Nay Pyi Taw, want a more streamlined tax system for land purchases. The reason? To attempt to create a fair platform for people to pay taxes as MPs argue that the complexities behind existing taxes mean people avoiding pay them.
The current tax system includes stamp duty at 3 percent and then an additional amount calculated as a percent of the transaction value. 15 percent for sales up to MYR 30 million, 20 percent for over MYR 30 million to 100 million, 30 percent for anything over.
Due to increasing land values, MYR 30 million does not get you much in Yangon or Mandalay anymore. Therefore MPs have called for the price brackets to be reviewed. Their request is that for any purchase up to MYR 100 million there would be a 5 percent tax. Over this amount up to MYR 200 million the tax would be at 10 percent, 15 percent to MYR 300 million, 20 percent to MYR 400 million, 25 percent to MYR 500 million and 30 percent for any transaction over MYR 500 million.
A new tax system would also help the development of people to encourage them to buy land who are currently deterred by the current high rates. Plus it should help people to actually pay their taxes due to a more transparent system. One MP claimed that in Mandalay 90 percent of the property market avoided paying tax.