Gem entrepreneurs have urged the Ministry of Planning and Finance to review the commercial tax rate on the gems sector which is listed as a special item in the Special Commodities Tax Law.
In 2015, the commercial tax rate was set at 15 percent for raw gem stones such as jade, rubies, sapphires, emeralds and diamonds for foreign trading, but it has increased to 20 percent this year.
This rate hike has caused local gem entrepreneurs to call for a rate review, according to U Tun Hla Aung, secretary of Myanmar Gems and Jewellery Entrepreneurs Association.
“Gems should not be on the list of special commodity items. Gems are not harmful commodities items such as liquor, beer and cigarettes. Raising the tax rate is likely due to smuggling in the gem sector, so we urged the minister of natural resources and environmental conservation to review the regulation carefully,” U Tun Hla Aung said.
In this year, the number of visitors to the jewellery exhibitions in Naypyitaw decreased as well as demand for precious stones. Many gem entrepreneurs have been facing challenges in the market due to weakened demand for gems in recent expos.
The vice chairman of Information Committee of Mandalay Region Gems and Jewellery Entrepreneurs Association, U Myint Khaing, told Myanmar Business Today that raising the tax rate will hurt local entrepreneurs.
“The 2015 Union Tax Law was originally set at 20 percent of commercial tax for the gem sector, but it was reduced to 15 percent based on pleas from the entrepreneurs. Our business is decreasing but we still pay tax,” he said.
The Mandalay Region Gems and Jewellery Entrepreneurs Association also expressed their frustration with the new rate and the Myanmar Gem Law to the Ministry of Planning and Finance in a recent meeting with representatives from Internal Revenue Department and spoke about their challenges and difficulties as entrepreneurs.
According to 2016 Special Commodities Items Tax Law, there are 16 special commodities items including items such as tobacco products, alcohol, forestry products, precious stones, vehicles and fuel.
Source: Myanmar Business Today
