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Myanmar Millenium Development Goals 2006

 

Home >> Business Opportunity >> Foreign Investment Environment  
Directorate of Investment and Company Administration
FOREIGN INVESTMENT ENVIRONMENT

6. Tax Incentives under the Foreign Investment Law
i.    Exemption from income tax for 3 consecutive years beginning with the year in which the operation commences and a further tax exemption or relief for an appropriate period in case if its considered beneficial for the State.
ii.    The Commission may also grant:-
  - exemption or relief from income tax on profit which is reinvested within one year.
  - relief from income tax up to 50 percent on the profit from exports.
  - right to pay income tax on behalf of the foreign employees and to deduct the same from the assessable income of the enterprise.
  - right to pay income tax of the foreign employees at the rate applicable to the citizens of The Republic of the Union of Myanmar .
  - right to accelerate depreciation.
  - right to carry forward and set off losses up to consecutive years, from the year the loss is sustained.
  - exemption of relief from customs duty and other taxes on:-
   
(a) imported machinery and equipment for use during the construction period.
(b) imported raw materials for the first 3 years commercial production following the completion of construction.
7. Application Procedures for Foreign Investment
     A promoter for foreign investment must submit a proposal in prescribed form to the Myanmar Investment Commission for consideration of issuing a permit. With the Proposal the following must be attached.
  i. Documents supporting financial credibility. (audited final accounts of a most recent year of the person or the firm that intends to make investment).
  ii. Bank recommendation regarding the business standing.
  iii. Detailed calculation relating to the economic justification of the proposed project indicating inter alia:-
   
- estimated annual net profit.
- estimated annual foreign exchange earnings or savings and foreign exchange requirement for the operation.
- recoupment period.
- prospects of creating employment.
- prospects of increase in national income.
- local and foreign market conditions and the requirement, if any, for local consumption.
  iv. If it is a hundred percent foreign investment, a draft contract to be executed with an organization determined by the Ministry concerned.
  v. If it is a joint venture, a draft contract to be entered into between the foreign investor and local counterpart.
  vi. If it is a joint venture in the form of a limited company, draft Memorandum and Articles of Association and also a draft contract between the foreign and local investors.
  vii. Other related draft contracts are also to be submitted together with the proposal.
  viii. The promoter may apply for the exemptions and reliefs from taxes stated in Chapter 10 Section 21 of the Union of The Republic of the Union of Myanmar Foreign Investment Law.
8. Guarantee
Right to Transfer Foreign Currency
i. A person who has brought in foreign capital can transfer the following:-
 
- foreign currency entitlement of him.
- net profit after deducting all taxes and provisions.
- foreign currency permitted for withdrawal by the Commission which may include the value of assets on the winding up of business.
ii. A foreign employee can transfer his salary and lawful income after deducting taxes and other living expenses incurred domestically
Guarantee
  Enterprises operating under the Foreign Investment Law shall have the State guarantee against nationalization and expropriation.
9. Importing and Exporting
  An enterprise permitted under the FIL has to be registered as exporter/importer upon business requirement with the Export Import Registration Office under the Directorate of Trade, Ministry of Commerce.
  The following persons or enterprises can be registered as exporters/importers:-
 
(a) Partnership firms
(b) Limited companies, inclusive of foreign companies and branches or joint ventures formed under the Myanmar Companies Act 1914 on Special Company Act 1950.
(c) Co-operative societies, registered under the Co-operative Society Law 1992.
     The Republic of the Union of Myanmar products can be exported with the exception of some selected items or restricted items under the export license.
     All goods which are not prohibited by the respective Government departments can be imported under the import license.
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