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Myanmar

Government and institution measures in response to COVID-19.

Government and institution measures in response to COVID-19.

Tax measures – Direct and Indirect

(e.g. payment deferrals, rate reductions…)

Click here to see a comprehensive summary of jurisdictional tax measures and government reliefs in response to COVID-19.

Employment-related measures

(e.g. state compensation schemes, training…)

Measures regarding visa extensions for foreign workers

  • The Directorate of Investment and Company Administration (DICA) is facilitating the stay permit and visa extension process to be conducted digitally.

Production of essential products

  • The Ministry of Labour, Immigration and Population (“MoLIP”) announced that factories will be allowed to open after inspections that are to take place from April 20 to April 30. Priority will be given to pharmaceutical factories, foodstuff factories, and factories with more than a thousand workers.

Economic stimulus measures

(e.g. loans, moratorium on debt repayments…)

Interest Rates

  • The Central Bank of Myanmar (“CBM”) issued a notification announcing further reductions in interest rates to be effective April 1, 2020.
  • In addition to the 0.5% reduction in rates that became effective on March 16, 2020, the further 1.0% reduction results in a total of 1.5% reduction in rates announced within the last two weeks.
  • The first rates cut of 50 basis points was announced on March 12, 2020 to be effective March 16. A subsequent cut of 100 basis points was announced March 24 to be effective April 1, 2020.
  • The most recent decision brings rate cuts to a total of 3.0%. Deposit rates will be subject to a lower minimum rate of 5.0%, secured lending rates will be subject to a lower maximum of 10.0%.
  • However, unsecured lending rates will not be subject to the latest round of rate cuts and will remain at a lowered maximum rate of 14.5%.
  • The CBM announced that it will also conduct credit auctions as necessary, to inject more liquidity into the banking and financial sector.
  • On May 26, 2020, the Assembly of the Union of Myanmar approved of a 700 million USD loan from the International Monetary Fund to aid with budget deficits due to COVID-19.

Relief for borrowings of entities and individuals 

  • The Ministry of Planning, Finance, and Industry (“MoPFI”) announced on March 18, 2020 that SMEs, Hotel and Tourism, and CMP (Cutting, Making, Packaging) companies will be able to apply for loans with a 1% interest rate for a period of 1 year. These loans are being disbursed from a relief fund of 100 billion MMK, with 50 billion MMK drawn from the country’s revolving fund and 50 billion MMK drawn from the social welfare fund. Application can now be submitted online.
  • The Myanmar Agricultural Development Bank (“MADB”) under the MoPFI is offering agricultural, rural development, and livestock loans at reduced rates approximately 1% to 1.5% lower.
  • The MoPFI announced that it will guarantee 50% of any new loans made by banks to enterprises not beneficiaries of the low cost fund for working capital.
  • CBM announced it will allow banks to restructure and reschedule MSME loans that regularly pay interest and principal for a longer period no more than 3 years.

Protection of Essential Products

  • The Ministry of Commerce has banned speculation in the market of selling and distributing health aid equipment related to COVID-19, medicines, and consumer goods.
  • Waiver of the “specific goods tax,” customs duties, and commercial tax on “critical” medical supplies and products related to the prevention, control, and treatment of COVID-19

Import/Export

  • The Myanmar government announced on March 17, 2020 that the advance income tax of 2.0% on exports will be waived until the end of the fiscal year on September 30, 2020.
  • India extends deadline to import quota of 250,000 tons of Myanmar mung beans until May 15, 2020.

Emergency response funding

  • The World Bank approved a 50 million USD loan for the Myanmar COVID-19 Emergency Response Project to support prevention operations and healthcare facilities.

Other measures and sources

Safety Measures

  • Some cities have imposed curfews. Yangon will effectively be under a curfew from 10pm to 4am.
  • The Ministry of Health and Sport has:
    • Banned gatherings of five people or more effective April 17, 2020.
    • Imposed stay-at-home orders in seven townships in Yangon Region.
  • The Ministry of Labor, Immigration and Population announced that factories will be allowed to open after inspections that are to take place from April 20 to April 30. Priority will be given to pharmaceutical factories, foodstuff factories, and factories with more than a thousand workers.

Visa extensions for foreigners

  • The Directorate of Investment and Company Administration (DICA) is facilitating the stay permit and visa extension process to be conducted digitally.
  • The Myanmar government announced on March 17, 2020 that the advance income tax of 2.0% on exports will be waivered until the end of the fiscal year on September 30, 2020.
  • The Directorate of Investment and Company Administration (DICA) is facilitating the stay permit and visa extension process to be conducted digitally.
  • The MoPFI called for investments for manufacturing COVID-19 related medical products using vacant state-owned factories.
    • Initiatives have also been taken to better support and ease processes for high impact investments, e-commerce, infrastructure, and agriculture enterprises.
  • The MoLIP announced it will extend healthcare benefits for SSB members and medical and travel benefits for 6 months to 1 year from the date of unemployment.

Contact us

Tax: Thomas Chan – thomas.chan@kpmg.com
Legal: Boon Kwang Thomas Chan - tchan8@kpmg.com