Rising taxes slash profits for roadside businesses in Mudon Town, amongst allegations of corruption

July 1, 2015

Business owners report rising taxes for roadside restaurants and shops in Mudon Town, Mon State. With both Municipal and Gross Profit taxes increasing, even owners of large businesses have reported difficulties turning a profit. Exacerbating concerns, business owners have also complained of corruption and inequity amongst local tax collectors.

Daw Nge Kyin, who owns Chaw Ei San noodle restaurant in Mudon Town, explained, “Our restaurant is not very big. We are charged 300,000 Kyat per year in Gross Profit taxes. In previous years we were charged 100,000 Kyat, then 150,000, 200,000, 250,000 and now 300,000 Kyat”. While Daw Nge Kyin detailed that shop owners could pay the Gross Profit tax in installments throughout the year, she described increasing difficulties due to simultaneous rises in Municipal Taxes and business costs. According to Daw Nge Kyin, “The products are becoming more expensive, workers’ salaries are also rising, and tax is increasing too. It is difficult to do business”.

Due to these concerns, Daw Nge Kyin explained that during the rainy season she earns only 40,000 to 50,000 Kyat per day. While profits are higher in the summer months, business still remains difficult for her.

Compounding worries over rising taxes, Daw Nge Kyin also raised concerns about suspected corruption within the tax system. “I asked the tea shop near my restaurant how much they have to pay in tax” she detailed, “but they didn’t say anything. I heard that they don’t have to pay [tax] because they are members of the USDP [Burma’s ruling military-backed party].”

Daw Myint May, a 45-year-old salad seller, echoed these suspicions, “What I am concerned about is that we are charged different amounts in taxes. For Municipal Tax, one staff member came and collected this amount in taxes, then another staff member came and collected a different amount. They only give us a receipt when we ask. Sometimes we are suspicious about whether the [money] we are paying is really Municipal Tax”.

“When they collect taxes unjustly we feel like we have to pay tax to them from the profits we make for our family’s livelihood” Daw Myint May explained, “I’m not saying this because I don’t want to pay taxes, but taxes should be fair and just”.

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