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Tax Notes: The 2% Withholding Tax abolished!

Tax Notes: The 2% Withholding Tax abolished!

June 20, 2018

The Ministry of Planning and Finance has enacted a new Withholding Tax (“WHT”) Notification 47/2018 (“Notification 47”) on 18 June 2018 which is effective from 1 July 2018. The Notification 47 abolishes 2% WHT for payments to resident citizens and resident foreigners for services rendered, goods purchases and lease payments within Myanmar.

Government organization, ministry and state-owned enterprise are excluded and 2%WHT is still applicable. Accordingly, government organizations, ministries and state-owned enterprises will continue to deduct 2% WHT when making payments to resident citizens and foreigners.

Furthermore, the minimum threshold for deductions of WHT has been changed to MMK 1 million for total payments within a year period. If payments exceed the threshold, companies are required to deduct WHT. We note that there is no threshold for payments made to non-residents.

The Notification 47 still imposes legal obligations on the payer to deduct WHT for payments subject to WHT.


Jean is one of the region’s most experienced tax and regulatory specialists with more than 12 years of experience in Indochina, Myanmar and Singapore. She has advised on a large number of project transactions and tax disputes in the specialties of structuring, power plant projects and oil & gas. As the managing partner of VDB Loi, Jean has extensive experience with projects related to the market entries of companies in the infrastructure, telecommunications and financial services industries in the region, as well as with supply chains. She lives in Yangon.
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Ngwe Lin has a master's degree in finance from Umea University in Sweden and a bachelor's degree in commerce from the University of Newcastle in Australia. She has extensive experience advising multinational clients in a wide range of industries in terms of tax structuring, cross-border tax issues, tax disputes, and tax compliance matters. She has also advised an impressive list of oil and gas supermajors and IPPs on the tax structuring of their energy projects in Myanmar and has assisted on various tax dispute cases in the oil and gas sectors.

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