Gov’t Seeks Green Light from Parliament to Join BRI Tax Scheme as Observer

By Nan Lwin 29 May 2019

YANGON—President U Win Myint has sought Parliament’s approval to sign a memorandum of understanding (MoU) that would give Myanmar observer status in a multilateral tax cooperation mechanism established under Beijing’s ambitious Belt and Road Initiative.

The BRI Tax Administration Cooperation Mechanism, also known as BRITACOM, aims to facilitate cross-border trade, investment and projects for enterprises and countries along the BRI’s routes by helping to resolve tax disputes and barriers.

“We will have a chance to improve tax management proficiency,” Deputy Planning and Finance Minister U Maung Maung Win told Parliament on Wednesday.

The deputy minister said signing the MOU gives Myanmar the opportunity to be involved in discussions on tax management cooperation. He said this would improve the conditions in which the country implements long-term projects under the China-Myanmar Economic Corridor (CMEC) agreement.

In November, Myanmar signed an MOU with China agreeing to establish the CMEC as a component of the BRI. The estimated 1,700-km-long corridor will connect Kunming, the capital of China’s Yunnan Province, to Myanmar’s major economic centers—Mandalay and Yangon—and the Kyaukphyu Special Economic Zone (SEZ).

The governments agreed to collaborate in many sectors including basic infrastructure, construction, manufacturing, agriculture, transport, finance, human resources development, telecommunications, and research and technology. So far, Myanmar has agreed with China to construct three border economic cooperation zones in Shan and Kachin states as part of the CMEC agreement.

In April, 34 countries including Cambodia, Indonesia and Bangladesh joined BRITACOM as council members, while the tax authorities of 11 nations including Singapore, Italy, Greece, Iran, Saudi Arabia and New Zealand joined as observers.

Members agreed to open an office in Beijing to expand tax dispute resolution activities and increase transparency, according to an official BRI statement. It said collaboration between the tax administrations of BRI countries would lead to the pooling of skills and expertise on tax collection; strengthen national tax rules in the areas of withholding tax and transfer pricing; and facilitate dispute resolution to ensure that fair amounts of taxes are collected.

U Maung Maung Win said the government sought approval from the Ministry of International Cooperation and the Ministry of Investment and Foreign Economic Relations, along with related government departments, to sign the MOU.

“The Union government has already approved it,” he said.

Union Parliament Speaker U T Khun Myat said a final decision would be made next week. Those lawmakers who want to discuss the issue in Parliament have until Friday evening to submit their names, he said.

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