On 15 March 2026, the National Defence and Security Council enacted the Union Taxation Law 2026 (Law No. 18/2026 or “2026 UTL”), which sets out the applicable tax rates and procedures governing income tax, commercial tax, specific goods tax, and gemstone tax in Myanmar. The law takes effect on 1 April 2026 or the start of the financial year 2026-2027.
The 2026 UTL retains most of the provisions of the Union Tax Law 2025, with notable amendments relating to the specific goods tax, including revised rates for certain specific goods, the introduction of specific goods tax and commercial tax on battery electric vehicles, and an update to the income tax exemption threshold for small and medium-sized enterprises.
A. Matters relating to Specific Goods Tax (“SGT”)
The 2026 UTL increased the SGT tiers and rates for cigarettes, cheroots, liquor, and wine. In addition, it removes the SGT exemption previously granted to battery electric vehicles (“BEVs”), which are now subject to a fixed rate of 5%.
Effective 1 April 2026, the following changes apply:
| Types of Goods | Tier | Tier of Selling Prices | Tax Rate |
|---|---|---|---|
| Cigarettes | Lowest | If sale price is a tier of MMK 1,000 per pack of 20 cigarettes (previously MMK 800) | MMK 15 per cigarette (previously MMK 14) |
| Highest | If sale price is a tier from MMK 2,001 and above per pack of 20 cigarettes (previously MMK 1,101) | MMK 31 per cigarette (previously MMK 30) | |
| Cheroot | N/A | MMK 3 per item (previously MMK 2) | |
| Liquor | Lowest | If a liter value is between MMK 700 and MMK 2,500 (previously MMK 400 and MMK 2,200) | MMK 287 per liter (previously MMK 261) |
| Highest | If a liter value is MMK 37,401 and above (previously MMK 28,601) | 60% of one liter’s value | |
| Wine | Lowest | If a liter value is between MMK 700 and MMK 3,500 (previously up to MMK 2,000) | MMK 250 per liter (previously MMK 210) |
| Highest | If a liter value is MMK 30,101 and above (previously MMK 28,601) | 50% of one liter’s value | |
| BEVs | N/A | N/A | 5% (previously exempted) |
The SGT rates for the following specific goods remain unchanged:
- Tobacco leaf and Virginia Tobacco: 60%
- Cigar, pipe tobaccos, and various kinds of spices for chewing betel leaf: 80%
- Beer: 60%
- Logs, conversions: 5%
- Vans, saloon cars, and others (excluding double cab 4-door pickup trucks and pickup cars): 10-50%
- Kerosene, petrol, diesel, and jet fuel: 5%
- Natural gas: 8%
B. Matters relating to Commercial Tax (“CT”)
The 2026 UTL does not introduce any changes to CT rate. However, “Battery Electric Vehicles including bikes and trikes using battery electric related items specifically used for Battery Electric Vehicle and their Battery” has been removed from the list of exempt goods. Meanwhile, the list of exempted services from the prior year tax law remains unchanged.
The CT rate remains at 5%, with specific rates applying as follows:
- Internet services: 15%
- Sale of SIM cards and related services: MMK 20,000 per SIM card
- Hotel and tourism services: 3%
- Sale of buildings constructed in Myanmar, whether through a long-term lease with the State or a partnership with a lessor: 3%
- Sale of gold jewelry: 3%
- Export sale of electric power: 8%
C. Matters relating to Income Tax
A key update under the 2026 UTL relates to the income tax exemption threshold for eligible start‑up micro, small and medium enterprises, cottage industries, and small‑scale domestic production‑based industries. Effective 1 April 2026, the threshold has been increased from MMK 15 million to MMK 20 million per year. The exemption applies for three consecutive years, including the year of commencement of business, with income exceeding the threshold remaining taxable.
Apart from this, the 2026 UTL does not introduce any changes to income tax rates. The following rates continue to apply:
- The general corporate income tax (“CIT”) rate remains at 22%. Companies listed on the Yangon Stock Exchange are subject to a reduced rate of 17%, while companies in the oil and gas exploration and production sector remain subject to 25%.
- The general capital gains tax (“CGT”) rate remains at 10%, with higher rates of 40-50% applying to the oil and gas sectors.
- The personal income tax (“PIT”) rates remain at 0-25%. Non-resident Myanmar citizens employed overseas are taxed using the lower of the following methods:
- Prevailing PIT rates (0-25%) after deductions for relief and allowances under the Income Tax Law; or
- A flat rate of 2% without deductions.
- Foreign income (other than salary) received by non-resident citizens is taxed at a flat rate of 10% without deductions or relief.
- The income tax for undisclosed sources of income remains at progressive rates of 3-30%.
- The 2026 UTL maintains the requirement for income tax payments to be made in the currency in which the income was earned, a requirement first introduced under the Union Tax Law 2024. This applies to all types of income tax payments, such as CIT, CGT, withholding tax, and PIT.
D. Matters relating to Gemstone Tax
The gemstone tax remains unchanged from the previous year. Gemstone sales in Myanmar continue to be taxed at a rate of 5-11%, with the rate varying based on the type of gem and whether it is sold as a raw material or as finished jewelry.
Conclusion
The 2026 UTL largely retains the provisions of the Union Tax Law 2025, with the principal changes concerning the SGT regime – most notably the upward revision of rates and tiers for certain specific goods, and the removal of the SGT exemption for BEVs, which are now subject to a 5% rate. The law also removes the commercial tax exemption previously applicable to BEVs and raises the income tax exemption threshold for eligible start-up businesses. Income tax rates, commercial tax rates, and gemstone tax rates otherwise remain unchanged.
Effective from 1 April 2026, taxpayers should consider the impact of these changes on their operations, pricing, and tax positions, particularly in light of the continued application of existing tax rules, including the requirement for income tax payments to be made in the currency in which the income is earned.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.
