Myanmar hikes income taxes on fuel firms

Myanmar has significantly raised taxes on domestic and foreign energy firms in a bid to fill the state's coffers, local media said.

Myanmar has significantly raised taxes on domestic and foreign energy firms in a bid to fill the state's coffers, local media said.

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The Weekly Eleven News, a semi-official journal, said on Monday that since June the military-run government had increased the income tax rate on domestic and foreign oil and gas companies to between 40-50 per cent of their profits.

Earlier, domestic firms had to pay out 35 per cent of their profits in income tax, with foreign energy firms being taxed at 40 per cent.

The US and Europe have slapped severe economic sanctions on Myanmar, one of the world's poorest nations, as punishment for rights abuses and the continued detention of democracy leader Aung San Suu Kyi, who has spent most of the last 17 years under house arrest.

But the impact of the sanctions has been weakened by the eagerness of neighbouring China, India and Thailand to tap Myanmar's vast natural wealth to fuel their own growing economies.

Natural gas from Myanmar currently makes up about 20 per cent of Thailand's supply, and existing untapped gas reserves offshore in Arakan State have sparked a fierce bidding war between India, China and Thailand.