Tax Collection Procedures Improving, But More Progress Needed
Tax Collection Procedures Improving, But More Progress Needed
Myanmar Times, 07 Dec 2018
URL: https://www.mmtimes.com/news/tax-collection-procedures-improving-more-progress-needed.html
Myanmar still collects the least amount of tax against GDP in ASEAN.
As the tax to GDP ratio for Myanmar is lower than that of its regional peers, successive governments have prioritised more efficient tax collection.
Efforts to reform tax collection began in 2012 under former president U Thein Sein. The aim of the effort was to put in place a modern tax administration system.
The first phase of the tax reform plan was carried out from 2012 to 2017, with the Internal Revenue Department (IRD) drafting regulations for tax reform. During the period, the country switched from the official assessment system (OAS) of paying taxes to the self-assessment system (SAS). In tax administration reform, the department changed from a paper-based administration system to IT-based system.
The adoption of the SAS was one of the main recommendations from the International Monetary Fund and World Bank in terms of change in Myanmar’s tax system.
The IRD expects tax collection from SAS taxpayers to be between 80 to 90 percent of total tax income in 2020. Currently though, just over 3000 taxpayers have registered under the SAS.
“The change in assessment systems required a change in people’s mindsets and some had difficulty with this. The department’s human resources are limited at present and the transition in assessment systems has not been something easy to do,” said IRD Director General U Min Htut.
As the tax to GDP ratio for Myanmar is lower than that of its regional peers, successive governments have prioritised more efficient tax collection.
Efforts to reform tax collection began in 2012 under former president U Thein Sein. The aim of the effort was to put in place a modern tax administration system.
The first phase of the tax reform plan was carried out from 2012 to 2017, with the Internal Revenue Department (IRD) drafting regulations for tax reform. During the period, the country switched from the official assessment system (OAS) of paying taxes to the self-assessment system (SAS). In tax administration reform, the department changed from a paper-based administration system to IT-based system.
The adoption of the SAS was one of the main recommendations from the International Monetary Fund and World Bank in terms of change in Myanmar’s tax system.
The IRD expects tax collection from SAS taxpayers to be between 80 to 90 percent of total tax income in 2020. Currently though, just over 3000 taxpayers have registered under the SAS.
“The change in assessment systems required a change in people’s mindsets and some had difficulty with this. The department’s human resources are limited at present and the transition in assessment systems has not been something easy to do,” said IRD Director General U Min Htut.