Unemployment rate has been in decline in the country and granting tax amnesty to businesspersons is not a good sign of benefit for the development of State’s economy, said State Counsellor Aung San Suu Kyi.
The remarks came from the State Counsellor’s reply to the report of Chairman Maung Weik of Saypaing Company, during the meeting with local business leaders at Myanmar International Convention Centre-1 in Nay Pyi Taw on August 28.
Chairman Maung Weik of Saypaing Company presented a report to State Counsellor Aung San Suu Kyi, saying that tax exemptions should be granted to those who do not show source of income paying for 30 percent revenues. Five percent should be exempted from paying the tax for one or two years. Employment has to be cut down.
“The current economic situation is running slow. The situation is so bad. Consequently, most of employments have to be cut down. This effect is pushing us into a state of reducing labours and employment. The employers have to make people unemployed because there is no more work left for them to do. Income is a key issue in dealing with the daily prices of commodities we are facing every day. Our trading situation is running slow.
“The main reason is an assumption that the investors will monitor the situation. Their monitoring is how much investment can be lost or how much profit can be acquired. If this point is sure for us, we will enter the market. If not so, we will leave the market. For our economic recovery, the inflow of numerous investors to the market is of great importance. So as to deal with the situation, we have two important points—one is the interest rate of bank loan for developers. The interest rate is K 13 and so it becomes unprofitable. This interest rate should be reduced to eight or nine for one or two years. The second point is tax rate. To start a business, related materials have to be bought.
“If we buy related materials, we will pay for 30 percent tax. As we have not started the business yet, 30 percent tax should be reduced to five percent for one or two years. The next point I would like to mention is we are paying 30 percent tax through bank loans when we buy related materials. As we have to buy related materials in use of bank loans, 30 percent tax should be exempted,” said Maung Weik.
Maung Weik added that Myanmar investors have to put forward the paid-up capital when they start the business, but the foreigners don’t have to do so. We would like to attain this chance like the foreigners. If the government grants tax amnesty, there will be an enormous increase in the number of investors flowing into the market.
Regarding taxation in Myanmar, those who do not show source of income have to pay for 30 percent revenues. Those who can show sources of their income are not required to pay for 30 percent tax.
Regarding the report of Maung Weik, Aung San Suu Kyi replied we have to look at the economy from different points of view. One side is not all right. For instance, the employers stopped the labourers from working as there is no more work left for them to do. But the latest date of the country showed that unemployment rate is not rising. In some places, workers were unemployed, but in some places, employed. We are required to notice it. The next point is bank interest rate. We don’t want the investors to lose these opportunities. At this point, I would like to tell. The most successful businessperson doesn’t do the business with the hope of winning 100 percent profit. No one can give 100 percent guarantee. For example, it is US dollar price. The dollar price effect comes out of the country. It is not easy to control this situation. We no need to worry 100 percent. We never give any guarantee. In some matters, the government will act in its capacity. For instance, as to the tax, economists do not agree on tax exemptions. On economist’s point of view, granting tax amnesty too much is not beneficial to the development of State’s economy. Our government has to listen to the voices coming from all sides. We have to weigh all sides. Single place of economy is not all right. Two or three places are not OK. We have to look at not only the requirements of the whole country but also the global current. But the two points must be consulted. Now it is not easy to give answer that we do or we don’t do.
Translated and Edited by Win Htut