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Myanmar
We have a team of experienced professionals dedicated to supporting all your business requirements—ensuring smooth operations and full regulatory compliance. This strong foundation enables you to confidently establish and grow your business in Myanmar with efficiency and assurance.
WHY MYANMAR?
Myanmar, officially the Republic of the Union of Myanmar and also referred to as Burma (the official English name until 1989), is a country in northwest Southeast Asia. It is the largest country by area in Mainland Southeast Asia and has a population of about 55 million. It is bordered by India and Bangladesh to the northwest, China to the northeast, Laos and Thailand to the east and southeast, and the Andaman Sea and the Bay of Bengal to the south and southwest. The country’s capital city is Naypyidaw, while its largest city is Yangon (formerly Rangoon).
Myanmar’s economy is one of the fastest growing economies in the world with a nominal GDP of US$76.09 billion in 2019 and an estimated purchasing power adjusted GDP of US$327.629 billion in 2017 according to the World Bank. Foreigners are able to legally lease but not own property. In December 2014, Myanmar set up its first stock exchange, the Yangon Stock Exchange. Myanmar has undergone a political and economic transformation with incredible speed and success and remains one of the fastest growing economies in East Asia. Myanmar’s economic isolation has reduced considerably, as it seeks to fully integrate into the global economy. In 2015, Myanmar held its first national election in 25 years, which ushered in a new era of quasi-democracy and economic prosperity. Investor expectations were so high that Myanmar experienced GDP growth of 7.2 percent, in a historic election year. The GDP growth is currently projected to continue averaging 7.1% per year, mainly driven by economic reforms, public consumption and private investment.
ADVANTAGES
Strategic Geographic Gateway:
Myanmar shares borders with China, India, and Thailand, acting as a critical bridge between South Asia and Southeast Asia. It provides direct access to a regional market of over 3 billion people through established trade routes and maritime ports along the Bay of Bengal.
Abundant Natural Resources:
The country is rich in high-value resources, including natural gas, timber, fertile agricultural land, and precious gemstones like jade and rubies. It also possesses significant untapped potential for renewable energy, particularly solar and hydropower.
Competitive Labor Costs:
Myanmar offers some of the most economical labour costs in Asia. This makes it an attractive destination for labour-intensive industries like garment manufacturing and IT offshore development.
Generous Tax Incentives:
Under the Myanmar Investment Law (MIL), investors in promoted sectors can receive corporate income tax exemptions for 3, 5, or 7 years depending on the development zone. Businesses operating within Special Economic Zones (SEZs) like Thilawa may receive even broader benefits, including duty-free imports of raw materials.
Liberal Foreign Ownership:
Foreign investors can hold 100% ownership in many sectors, including manufacturing, telecommunications, and retail/wholesale services. This allows for full operational control and decision-making.
Favourable Demographics:
With a population of approximately 55 million and a median age around 27, the country has a young, dynamic, and increasingly urbanized workforce with rising purchasing power for consumer goods.
ASEAN Integration:
As a member of the ASEAN trade bloc, businesses in Myanmar benefit from free trade agreements and preferential tariffs when exporting to other member states.
Simplified Registration:
The Directorate of Investment and Company Administration (DICA) has streamlined the business registration process through the MyCO online system, making it easier to incorporate new entities
TAX REGIME
Corporate Income Tax (CIT)
- Standard Rate:
22% for companies registered under the Myanmar Companies Law.
- Listed Companies:
17% for companies listed on the Yangon Stock Exchange.
- Oil & Gas Sector:
25% for companies in exploration and production.
- Foreign Entities:
Branch offices of foreign companies are generally taxed at 22%–25% on Myanmar-sourced income.
Personal Income Tax (PIT)
Personal income tax is applied to individuals based on their residency status, with a progressive rate ranging from 0% to 25%.
- Exemption Threshold:
Individuals earning MMK 4.8 million or less annually are exempt.
- Residency:
Residents (staying 183+ days) are taxed on worldwide income; non-residents are taxed only on Myanmar-sourced income.
- Nationals Overseas:
Non-resident citizens earning salary income abroad must pay the lower of the progressive rates (0–25%) or a flat 2% in the currency earned.
Commercial Tax (CT) and Specific Goods Tax (SGT)
Myanmar does not have a Value-Added Tax (VAT) system; it uses Commercial Tax and Specific Goods Tax instead.
- Commercial Tax:
Generally a flat 5% on most goods and services. Specific rates apply to gold jewelry (1%), hotel/tourism (3%), and internet services (15%).
- Specific Goods Tax:
Levied on “luxury” items like alcohol, tobacco, and petroleum products. Rates vary widely; for example, beer is taxed at 60%, while natural gas is at 8%.
Other Key Taxes
- Capital Gains Tax (CGT):
A flat 10% for most assets. Upstream oil and gas assets are taxed at higher progressive rates of 40%–50%.
- Withholding Tax (WHT):
Applied to payments for interest (15% for non-residents), royalties (15%–20%), and certain contracts (2%–3.5%). Dividends are currently exempt from WHT.
- Stamp Duty:
Levied on instruments like share transfers (0.1%) and property sales (2%–5% depending on location).
MYANMAR COMPANIES
Common Company Types
- Private Company Limited by Shares (Pte Ltd):
The most popular choice, offering limited liability, requiring one director/shareholder, with up to 50 members.
- Public Company Limited by Shares (PLC):
For larger entities, allowing public share trading, needing at least three directors (one citizen), and unlimited shareholders.
- Joint Venture:
Partnerships between local and foreign entities, often used for specific projects or sectors.
- Overseas Corporation (Branch/Representative Office):
For foreign companies to operate, with different rules for branches (can conduct business) vs. representative offices (limited activities).
Other Structures
- Sole Proprietorship:
Simple setup, unlimited personal liability for the owner.
- Partnership:
Two or more individuals, partners have unlimited liability.
- Company Limited by Guarantee & Unlimited Companies:
Exist but are less common for general business.
- Business Association:
For non-profit activities.
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Contact Us
Get in touch with the right people to get the right help in setting up your business in Myanmar.
enquiries@chandrawatpartners.com.