【Myanmar】Important Updates on Regulatory Compliance in Myanmar

We set out below selected recent legal and regulatory developments in Myanmar that may affect businesses operating in the country.

1. Mandatory Remote Work for Government Sector

   Effective from 25th March 2026, the National Defence and Security Council has mandated that all government officers and staff transition to work remotely every Wednesday to proactively mitigate potential fuel shortages linked to Middle East regional instability. This directive requires personnel to perform duties from their residences or hostels and strictly prohibits non-essential travel or vehicle use on these designated days to maximize fuel conservation. While the government maintains that current energy reserves are sufficient, this measure serves as a precautionary step alongside existing odd-even vehicle rotations and fuel rationing systems. Furthermore, private sector organisations are officially encouraged to adopt similar "work from home" arrangements to support national energy preservation efforts until further notice.

   
   

   Our Analysis: This directive forms part of the government’s latest efforts to curb rising fuel prices and demand, which have surged due to ongoing instability in the Middle East. Although the measure is formally limited to the public sector, it is expected that many private companies will voluntarily adopt similar work-from-home arrangements in practice. The initiative complements existing fuel management measures, including the odd-even vehicle refueling system, as well as restrictions on refueling volumes and permitted times. Taken together, these steps indicate a coordinated attempt to manage consumption rather than address supply. This is particularly relevant given that Myanmar lacks domestic refining capacity and remains fully dependent on imported petroleum products, including gasoline and diesel. As such, demand-side controls are likely to remain a key policy tool in the near term.

   
   

2. New Regulations on Foreign Investment Capital and Currency

   On 16th March 2026, the Myanmar Investment Commission (MIC) issued Notification No. 1/2026 and Investment Bulletin No. 1/2026, establishing mandatory capital requirements and foreign currency protocols for investment projects. Under these new regulations, investors are required to contribute at least 35% of the total investment amount in cash. Additionally, investors utilizing offshore loans must submit an approval letter from the Central Bank of Myanmar, along with a repayment schedule and proof of offshore fund transfers verified by Authorized Dealer (AD) banks. Furthermore, the directive mandates that foreign investors must facilitate all capital injections and related financial transactions using either US Dollars (USD) or Chinese Yuan (CNY), ensuring that any foreign currency brought into the country is processed and accounted for through legitimate banking channels to maintain national financial oversight.

   
   

   Our Analysis: With respect to the requirement to denominate foreign investment in USD or CNY, it is expected that the registered capital of companies, as reflected in filings with DICA and displayed on MYCO, will continue to be recorded in USD or MMK, consistent with existing practice. The introduction of a mandatory 35% cash contribution raises practical questions, particularly regarding implementation and verification. The overarching intent appears to be to ensure that MIC-permitted companies maintain sufficient working capital to support their operations. Notably, this requirement is expected to apply not only to new projects but also to existing MIC permit holders. At this stage, non-compliance does not appear to trigger revocation of the MIC permit itself, but may instead result in the withdrawal of associated tax incentives. The government has indicated that further clarification and guidance on this policy will be issued in due course.

   
   

3. Enactment of Union Taxation Law

   The Union Taxation Law 2026, enacted on 15 March 2026 and effective from 1 April 2026, largely retains the framework of the 2025 law while introducing targeted amendments, particularly in Specific Goods Tax (SGT) and income tax relief measures. Notably, SGT rates and tiers have been increased for cigarettes, cheroots, liquor, and wine, and Battery Electric Vehicles (BEVs), previously exempt, are now subject to a 5% SGT. Similarly, BEVs and their related components have been removed from the list of Commercial Tax (CT) exemptions and are now subject to the standard 5% CT, although overall CT rates remain unchanged.

   
   

   In terms of income tax, the law raises the exemption threshold for micro, small, and medium enterprises (MSMEs) from MMK 15 million to MMK 20 million per year for up to three consecutive years, while maintaining existing tax rates for corporate income tax, personal income tax, and capital gains tax. The requirement to pay income taxes in the currency in which income is earned also continues. Meanwhile, gemstone tax rates remain unchanged at 5–11%.

   
   

   Our Analysis: The amendments introduced under the Union Taxation Law 2026 suggest a clear policy direction towards increasing government revenue, particularly through higher excise-type taxes. The upward revision of Specific Goods Tax rates on items such as tobacco and alcohol, together with the removal of tax exemptions for electric vehicles and related components, reflects a broadening of the tax base. While core tax rates remain unchanged, these targeted adjustments indicate a calibrated approach to revenue generation without overhauling the overall tax framework. In this context, the changes can be seen as part of a broader fiscal strategy to strengthen public finances amid ongoing economic pressures.