Myanmar regime to require proof of paying taxes for passport renewals 

The junta, facing dire financial troubles, is demanding foreign currency-denominated payments from seamen and expatriates as a condition for keeping their documents up to date

Myanmar’s passport-issuing offices have announced that Myanmar nationals earning income in foreign countries and aboard ships must now obtain a tax clearance certificate in order to renew their passports. 

The notices posted at the passport offices – which operates under the regime’s Ministry of Home Affairs– state that expatriate migrant workers renewing a Passport for Job (PJ) or sailors renewing a Passport for Seaman (PS) will be required to present the certificate issued by the Internal Revenue Department of the junta’s Ministry of Planning and Finance.

When Myanmar Now contacted the passport office in Naypyitaw, the staff member who answered confirmed that the new requirement was correct, but declined to give further details.

According to the passport office staff member, if passport-holders cannot show proof of having paid their taxes, their passports will not be renewed. However, there is an option available for those wishing to renew their passports abroad to pay all their taxes to the relevant embassies in one lump sum.

More than two and a half years after the coup, the military junta is in urgent need of foreign currency due to the withdrawal of foreign businesses from the country and the imposition of international sanctions on regime officials and their associates. The regime announced plans to tax Myanmar expatriate workers starting in October, as well as subsequent plans to further limit and control passport renewals. 

As a result, expatriate and seafaring workers who do not pay taxes to the military junta will effectively lose the ability to travel to or live in foreign countries, said a tax expert who asked not be named for security reasons.

“That’s how it will happen. Of course the workers have to give them money, they are just robbing them,” the tax expert said. 

An announcement posted at the passport office
in Myawaddy, Karen (Kayin) State (Supplied)

On September 23, junta-controlled newspapers announced that the Union Tax Law of 2023 had been amended to collect income taxes from Myanmar expatriate workers and citizens.

Junta chief Min Aung Hlaing signed the Union Tax Law, which is enacted annually, with amendments to Section 22 that will remain in effect from October 2023 through the end of March 2024.

The amendments removed the income tax exemption for migrant workers overseas, which was first included in the law in January 2012 under former President Thein Sein’s government and remained in effect for over a decade.

The amended law provides two methods for calculating the tax due on workers’ earnings in foreign currency: either by income stratum, or at a rate of two percent of income with no deductions. A worker with foreign currency-denominated income must pay the lower of the two calculated amounts. 

Myanmar citizens living abroad will also no longer be exempt from paying income tax on “non-salary” income—that is, funds earned abroad as business income or on a payment-per-service basis—and will be required to pay 10 percent of their total non-salary income in foreign currency.

Failure to present a tax clearance certificate may also result in regime officials taking more severe punitive measures, such as revoking passports, withholding new passports, imposing foreign travel bans, or bringing charges or civil suits against citizens under the Tax Administration Law.

Myanmar has signed double tax avoidance agreements with eight countries—India, Laos, Malaysia, South Korea, Singapore, Thailand, the United Kingdom, and Vietnam. 

While these agreements are intended to indemnify citizens against paying taxes twice on the same earnings, it is still too early to know how the amended law will affect Myanmar workers who are already staying in those countries, according to the tax expert who spoke with Myanmar Now. 

One Myanmar worker in Singapore said most expatriate workers will probably have to double-pay their income taxes under the junta’s new plan. Connecting tax requirements to passport renewals may force workers to pay the taxes even if they are not willing or are earning income not legally subject to taxation, she said, and the program is likely to generate substantial revenue for the junta.

Before imposing the new requirement, the regime was already enforcing a directive requiring Myanmar workers abroad to remit 25 percent of their earnings via Myanmar’s domestic banks to family members living inside the country.

According to labour advocacy organisations in Thailand, there are currently more than 1.7 million migrant workers from Myanmar working legally in Thailand, including more than 300,000 people working under a Memorandum of Understanding (MOU) between the two countries. 

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