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Essential Guide to Customs Import Tariffs in Myanmar

October 17, 2023

Myanmar, a Southeast Asian nation with a rich cultural heritage and a rapidly developing economy, is increasingly becoming an attractive destination for international trade.

Its strategic location, nestled between India, China, Thailand, and Bangladesh, makes it a prime hub for import and export activities. Understanding the country’s import tariffs, customs duties, and regulations is paramount to successfully navigating Myanmar’s complex world of international trade.

This comprehensive guide will explore the essential aspects of Myanmar’s import regulations, including tariffs, customs duties, rules, and best practices.

Table of Contents

Types of Import Tariffs and Fees in Myanmar

Import tariffs in Myanmar are taxes imposed on goods imported into the country. These tariffs serve various purposes, such as generating revenue for the government, protecting domestic industries, and regulating international trade. Importers should know the tariff rates applicable to their specific goods to plan their import operations efficiently.

A. Import Tariff

Myanmar is part of the World Trade Organization (WTO) but only follows global tariff rules for 18% of its goods and services. Its tariffs are usually similar to or lower than neighbouring countries, ranging from 0% to 40%, with luxury items taxed the most.

Regarding the country’s tariff classification, Myanmar uses the Harmonized System (HS) to classify goods, a global standard for categorising products based on their features and composition. This classification is vital because it sets each product’s tariff rates and import rules. You can visit the Myanmar Customs Department website or learn from their customs tariffs guide here for specific tariff rates.

B. Preferential Tariff Schedule of FTAs

Myanmar has entered into several Free Trade Agreements (FTAs) with neighbouring countries and trading partners, which offer preferential tariff rates for goods traded among the signatory nations. These FTAs can significantly benefit importers, as they may allow for reduced or exempted tariffs on certain items.

Some of the critical FTAs that Myanmar is part of include:

Understanding the specific provisions of these FTAs and ensuring compliance with their rules of origin is crucial for importers seeking to take advantage of reduced tariff rates.

C. Customs Duties

Customs duty in Myanmar is a tax imposed on imported goods, and it’s determined by the Customs Tariff of Myanmar (2017). The rates can go as high as 50%. Companies registered under the MIC/SEZ may get exemptions from these duties for specific periods if approved by the MIC/SEZ Committee.

These duties are calculated based on the customs value of the goods, including the cost, insurance, and freight (CIF). The customs duty rates can vary widely, depending on factors such as the type of goods, where they’re from, and any preferential tariff agreements under Free Trade Agreements (FTAs). Importers should accurately declare the customs value of their goods to ensure that the customs duties are calculated correctly.

1. Value Added Tax (VAT)

In Myanmar, there is no Value Added Tax (VAT). Instead, the country has an indirect tax known as commercial tax, which has a standard rate of 5%. This tax applies to various goods and services produced, traded, or provided within Myanmar. It is calculated based on the sales proceeds and applies to imported goods.

Forty-six specific types of goods are exempt from the commercial tax. A 5% commercial tax is generally imposed for services, except for 33 specific types of services exempt from this tax. Examples of exempted services include life insurance, banking and financial services authorised by the Central Bank of Myanmar, microfinance, public transportation, and publishing services.

2. Special Commodity Tax (SCT)

Myanmar’s Specific Goods Tax Law has replaced the commercial tax for certain goods. These goods include cigarettes, alcohol, wood, certain vehicles, and fuel. The tax rates for these goods range from 5% to 60%. Only manufacturers of these specific goods can offset the tax they pay on materials against the tax they charge when selling them.

Additionally, a 5% commercial tax is imposed on top of the specific goods tax. Companies registered under certain committees may be exempt from internal taxes, including the particular goods tax, for specific periods at the discretion of those committees.

3. Commercial Tax

While customs duties, VAT, and SCT are applicable at the border, Myanmar also levies a Commercial Tax on goods at the domestic level. This tax applies to both locally produced and imported goods and is usually calculated as a percentage of the sales price.

D. Exemptions and Reliefs

Myanmar offers certain exemptions and reliefs from customs duties and taxes for specific categories of importers or goods. A Special Import Permission determines this exemption allows certain imports to enter a country without paying taxes and duties immediately. This rule usually applies to goods that can quickly go bad, things for diplomats, and a few specific items. The importer needs to provide a financial guarantee (like a deposit) to use this option.

Myanmar Import Rules and Regulations

A. Import Licensing

The Government of Myanmar has made it easier to obtain import licences, but some products still require one.

Here’s a straightforward overview of the process:

Import License Issuer: Import licences are issued by the Department of Trade within the Ministry of Commerce.
Products Requiring Import Licences: Some products require an import licence, and the list can be found here. These include items like chemicals, seeds, medical equipment, and more.
Additional Requirements: You might need a recommendation or certificate from relevant ministries or agencies for certain commodities. Here’s a breakdown of which ministries are involved:

- Seeds, plants, and more: Ministry of Agriculture, Livestock, and Irrigation.
- Animals, animal feed, and veterinary items: Livestock Breeding and Veterinary Department.
- Fishery products: Department of Fisheries.
- Timber, chemicals, and minerals: Ministry of Natural Resources and Environmental Conservation.
- Medical and food products: Ministry of Health and Department of Food and Drug Administration.
- Precursors for drugs: Ministry of Home Affairs.
- LPG: Ministry of Energy.
- Foreign movies: Ministry of Information.
- Telecommunication equipment and vehicles: Ministry of Transport and Communications.
- Chemicals and related substances: Ministry of Industry.
- Radioactive materials: Ministry of Science and Technology.

Applying for Import Licences: You can apply for import/export licences online through the TradeNet2.0 system at the Ministry of Commerce’s website here.
Border Trade: The Department of Trade operates a Border Trade Online System (BTOS) for processing import licences at border posts.
Licence Validity: An import licence is valid for three months. You can extend it for two more months with an additional extension of one month if needed. Fees for extensions can be found here.
Licence Amendments: You can amend import licences before shipment. Check the service fees here.
Automation of Customs: Myanmar Customs is developing an automated cargo clearance system (MACCS) to streamline customs operations. It will reduce processing times and improve import restrictions enforcement.

Please note that import licence requirements are reviewed annually, and changes may occur throughout the year. Be sure to stay updated on any new developments.

B. Restricted and Prohibited Items

Myanmar has a list of restricted and prohibited items subject to specific import regulations. These regulations are in place to protect public health, safety, national security, and the environment. Importers must obtain the necessary permits or meet specific requirements when dealing with these items.

The Directorate of Trade, part of the Ministry of Commerce, is responsible for updating the list of items banned from import. These changes are often sudden and may not be widely announced. The current list prohibits the import of counterfeit money, pornographic items, narcotics, playing cards, and products displaying images of the Buddha, Myanmar pagodas, or the Myanmar flag. For more information, visit this link: Myanmar Trade Portal.

C. Customs Documentation

It’s vital to have accurate and complete customs documentation to ensure a smooth import process in Myanmar. The key customs documents required for imports include:

Invoice: A detailed document specifying the products, quantities, prices, and other financial details of the imported goods.
Packing List: An inventory of the contents and packaging details of the shipment.
Sale Contract: A formal agreement outlining the terms of the sale and purchase of the imported goods.
DO/BL (Delivery Order/Bill of Lading): A document issued by the carrier that confirms the shipment’s receipt and serves as evidence of ownership.
Import License/Import Permit/Non-License (if applicable):

Sale Contract: As mentioned above.
Company Registration and Product/Import Certificate: Proof of the importing company’s legal status and authorisation.
Form VI and XXVI: Specific forms required by the customs authorities.

Other Required Documents: Depending on the nature of the imported goods, additional documents may be necessary, such as:

FDA Certification: For food products, demonstrating compliance with food and drug regulations.
Medicines DRC (Drug Registration Certificate): If importing pharmaceuticals or medical products.
Pesticides Registration Office Certificate: For pesticide-related imports.
Agriculture and Irrigation Ministry Certification Letter: If importing agricultural products.
Lords of Beasts Meat/Eggs Health Certificate: Applicable to meat and egg products.
Phytosanitary Certificate: Required for plant, flower, and seed imports.
Letter of Approval from the Department of Animal Husbandry and Medical Treatment of Animal Feed and Medicines: Pertaining to animal feed and medicines.
Essential Oil Chemistry Recommendations: If importing essential oils.
Certificate of Storage and Maintenance of Dangerous Cargo: For dangerous goods.

Ensuring you have the correct documents in order and that they are accurate and complete is crucial to ensure the import process in Myanmar is smooth.

D. Inspection and Valuation

Customs authorities in Myanmar have the right to inspect and assess the value of imported goods. This assessment is crucial in determining the applicable customs duties and taxes. Importers should be prepared for possible customs inspections and ensure that their declared values are accurate and supported by documentation.

Intellectual Property Rights (IPR)

Myanmar enforces intellectual property rights and has regulations to protect trademarks, copyrights, and patents. Importers should be aware of these regulations to avoid potential legal issues related to importing counterfeit or infringing goods.

Myanmar Import Procedure

Navigating Myanmar’s import procedure is a multifaceted journey, marked by carefully adhering to crucial steps.

This intricate process is essential for businesses looking to bring goods into the country, and it comprises the following pivotal stages:

Register Your Business: Initiate the import process by registering your business in Myanmar, setting the stage for legal operations.
Verify Prohibited Imports: Ensure compliance by confirming that your imported goods are not on Myanmar’s list of prohibited items.
Obtain Import Licences: Secure the required import licences specific to your product category, as they act as your import permit.
Meet SPS Requirements: Comply with Myanmar’s stringent Sanitary and Phytosanitary (SPS) standards to guarantee the safety of food and agricultural imports.
Navigate TBT Regulations: Adhere to Myanmar’s Technical Barriers to Trade (TBT) requirements, which may involve adhering to technical standards for certain imports.
Complete Customs Declarations: Carefully submit customs declarations, providing comprehensive documentation such as invoices, packing lists, and certificates of origin.
Classify and Value Imports: Accurately categorise your imports under the Harmonized System (HS) code and declare their precise value for customs duty and tax calculations.
Pay Customs Duties and Taxes: Fulfil your financial obligations by paying the required customs duties and taxes, varying based on the nature and rates applicable to your imports.
Undergo Customs Inspection: Conduct a thorough customs inspection of your imported goods to ensure compliance with regulations and document accuracy.
Handle Temporary Imports: If your imports are temporary, like for exhibitions or repairs, follow the specific procedures for temporary imports and ensure their eventual return or re-export.
Seek Duty Exemptions: Explore potential duty exemptions or reductions for specific imports under special orders or agreements, capitalising on available opportunities.
Focus on the Garment Industry: If you’re involved in the garment industry, be attentive to sector-specific regulations, including sourcing and labour standards, which are integral to compliance.

Best Practices

To ensure a successful and compliant import operation in Myanmar, consider the following best practices:

Stay Informed: Keep abreast of changes in import regulations, tariff schedules, and trade agreements to optimise your import strategy.
Proper Documentation: Ensure all customs and trade-related documentation is accurate and complete.
Consult Professionals: Seek guidance from customs brokers, legal experts, and trade consultants specialising in Myanmar’s import regulations.
Compliance with FTAs: If your business qualifies for preferential tariff rates under FTAs, make sure to meet the origin criteria and follow the rules of the respective agreements.
Customs Valuation: Accurately declare the customs value of your goods to prevent disputes and delays at customs.
Supply Chain Management: Streamline your supply chain to minimise delays and reduce customs-related costs.
Due Diligence: Conduct due diligence on your suppliers to ensure they meet quality and compliance standards.
Intellectual Property Rights: Respect intellectual property rights and avoid dealing with counterfeit or infringing goods.
Environmental and Safety Compliance: Ensure your products comply with Myanmar’s environmental and safety regulations.
Record Keeping: Maintain organised records of your import transactions for auditing and compliance purposes.

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