The State Administration Council has imposed K20,000 per SIM card on the sales and activation of the SIM Cards and 15% commercial tax on internet services after amending Union Tax Law 2021.
“No matter what provisions the Commercial Tax Law comprises, only
once commercial tax shall be levied K20,000 per the sales of SIM cards and
SIM card activation,” read the Law Amending the Union Tax Law 2021.
The imposing of K20,000 tax and 15% commercial tax on internet services caused an outcry as the country’s economy is not functioning well while many people have lost their jobs amid COVID-19 and the consequences of the coup. Moreover, many people rely on the internet as they are working from home while students are joining their classes online.
However, the junta ratify their move by saying that imposing the tax on internet services and the sale of SIM cards generate more income for the country while “the effects triggered by extreme use of internet services on the employment of the people and physical and mental sufferings of the new generation students can be reduced.”
World Bank in July 2021 forecasted that Myanmar’s economy was expected to contract around 18 percent in Myanmar’s 2021 Fiscal Year due to the ongoing political turmoil and the third wave of COVID-19. An 18 percent contraction, coming on top of weak growth in FY2020, would mean that the country’s economy is around 30 percent smaller than it would have been in the absence of COVID-19 and the military takeover of February 2021.
Moreover, World Bank also estimated that around 1 million jobs could be lost, and many other workers will experience a decline in their incomes due to reduced hours or wages. The share of Myanmar’s population living in poverty is likely to more than double by the beginning of 2022, compared to 2019 levels.