Parliament rejects 200% tax increase on tobacco and alcohol

NAY PYI TAW—The Union Parliament on Monday (March 10) rejected a private member’s bill that proposed a 200 percent tax increase on tobacco products and alcoholic beverages.

Members of parliament voted instead to maintain the current “vice tax” rates. Myanmar currently imposes a 100-percent tax on cigarettes and a 50-percent tax on other tobacco products and alcohol.

National League for Democracy MP Khin San Hlaing (Pale Township) said the number of drinkers is on the rise in Myanmar, resulting in more crimes and alcohol-related health problems. She added that tobacco usage increases healthcare costs for the country by causing more cases of cancer.

“If we want to reduce the local consumption of such products, we need to impose more taxes on them. If we want more consumption, we should decrease the tax,” said Khin San Hlaing, submitting her proposal at the parliament.

“[Tobacco products and alcoholic drinks] are very dangerous for future generations of the country. We should impose more tax on them as an effort to put a stop to consumption. I propose that we increase the tax to 200 percent for the sake of the national interest.”

Minister of Finance Win Shein replied that such a high rate of increase could lead to tax evasion. He said that Myanmar’s tax rates for such products are relatively higher than the ASEAN regional average, and that the government’s current tax rates compare favourably with international standards.

The parliament voted to keep the rates unchanged.

Another proposal from MP Ko Gyi (Aung Myay Tharzan) called for a 50-percent tax increase on imported palm oil and related products. That proposal was also rejected by the parliament.

Privileged local companies such as Shwe Than Lwin, IBTC and businesses associated with “Pepsi” Thein Tun were granted permission to produce such goods after the new government was sworn in.

Source: ELEVEN Myanmar

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