Expansion of Investment Currency to Chinese Yuan and Introduction of Minimum Criteria for Tax Relief
The Myanmar Investment Commission (“MIC“) has issued two significant updates effective as of 16 March 2026, as detailed in MIC Notification No. 1/2026. First, the Chinese Yuan (CNY) has been officially approved as an additional foreign investment currency alongside the United States Dollar (USD). Investors may now submit capital, proposals, and endorsement applications in either currency. It is important to note that the currency used for bringing capital into Myanmar will determine the currency for subsequent transfers and payments, and all such transactions must be conducted through banks holding an Authorized Dealer (“AD“) licence for foreign exchange transactions.
Second, MIC has established minimum eligibility criteria for investors seeking tax exemption or relief in promoted sectors. Investors must now contribute at least 35% of the total stated investment amount in cash. Furthermore, where an investment involves foreign loans, the investor is required to submit the loan approval letter from the Central Bank of Myanmar (CBM) along with the repayment schedule, as well as evidence that both the foreign loan and foreign capital have been remitted in cash through an AD-licensed bank. These criteria are subject to revision in accordance with evolving state policy requirements.
Changes under Union Tax Law 2026
On 15 March 2026, the National Defence and Security Council enacted the Union Taxation Law 2026 (Law No. 18/2026) (“2026 Union Tax Law“), effective from 1 April 2026, for the 2026-2027 financial year. While the 2026 Union Tax Law largely retains the provisions of the 2025 Union Tax Law, several notable amendments have been introduced, primarily affecting the Specific Goods Tax (SGT) regime. With respect to SGT, the 2026 Union Tax Law has increased rates and revised tiers for cigarettes, cheroots, liquor, and wine. Additionally, the SGT exemption previously granted to Battery Electric Vehicles (“BEVs“) has been removed, and BEVs are now subject to a fixed SGT rate of 5%. Regarding Commercial Tax (“CT“), no rate changes have been made; however, BEVs and related items have been removed from the list of CT-exempt goods. Concerning Income Tax, the exemption threshold for eligible start-up micro, small, and medium enterprises, cottage industries, and small-scale domestic production-based industries has been increased from MMK15 million to MMK20 million per year. This exemption applies for three consecutive years, including the commencement year. All other income tax rates remain unchanged, including the general corporate income tax rate of 22% and the capital gains tax rate of 10%. The requirement that income tax payments be made in the currency in which the income was earned continues to apply.
Enactment of New Laws: (1) New Anti-Money Laundering Law, and (2) Construction Sector Development Law
The early part of the year saw the enactment of new laws on anti-money laundering and construction.
New Anti-Money Laundering Law
On 11 March 2026, the Government enacted a new Anti-Money Laundering Law (Law No. 16/2026) (“AML Law“), repealing and replacing the previous 2014 law. This new legislation addresses several critical areas, including the definition and scope of money laundering offences, the objectives of the law, and its application. The AML Law establishes an institutional framework for the administration and enforcement of the law, providing for the formation of central bodies and investigative authorities along with their respective functions and powers.
Construction Sector Development Law
On 4 February 2026, Myanmar enacted the Construction Sector Development Law (Law No. 5/2026) (“Law”), which will come into force on a date to be notified by the Office of the President. The Law applies broadly to construction-related activities, including the construction, expansion, renovation, maintenance, and demolition of basic structures, with the express exclusion of buildings constructed of wood and bamboo. A mandatory registration regime is introduced for individuals and companies providing construction-related services such as building services, construction consultancy, project management, quality control, architectural and engineering services, and third-party organisational review. Furthermore, the Law imposes quality control requirements on construction materials, mandating a Quality Assurance Certificate (QAC) for all construction materials that are imported, manufactured, or distributed in Myanmar.
Relaxation of Mandatory Foreign Exchange Conversion Ratio by the Central Bank of Myanmar
On 7 January 2026, the Central Bank of Myanmar (“CBM“) issued Notification No. 2/2026, which further relaxes the mandatory conversion requirements applicable to export earnings. The revised ratio is effective retroactively from 1 January 2026. Under the new framework, 15% of export earnings must be converted into Myanmar Kyat (“MMK“) at the CBM reference rate, while the remaining 85% may be converted into MMK at the online trading rate. This represents a reduction from the previous requirement, which mandated conversion of 25% at the CBM reference rate and 75% at the online trading rate. Exporters will benefit from greater exposure to market-based exchange rates, potentially improving MMK conversion outcomes and easing cash flow pressures. Companies are advised to review their foreign exchange conversion practices and banking arrangements to ensure compliance with the revised ratios as of 1 January 2026.
Introduction of New Microbiological Standards for Pre-packaged Foods
On 5 January 2026, the Food and Drug Administration of Myanmar issued Order No. 1/2026 (“Order“), prescribing new microbiological standards for pre-packaged foods. The order provided for a three-month transitional period from the date of issuance, which expired in early April 2026, within which all relevant business operators were required to take appropriate measures to achieve compliance. The new standards prescribed under the Order cover 16 main food categories, including dairy products, fats and oils, fruits and vegetables, confectionery, cereals, soy-based items, bakery goods, meat and meat products, fish and seafood, eggs, sweeteners, condiments, beverages, and infant foods. With respect to safety requirements, the standards mandate that certain harmful germs must be absent entirely in most ready-to-eat products. The Order also establishes maximum allowable levels for common micro-organisms that may naturally occur in food, with limits varying according to the type of food product and its processing method. For canned and other heat-processed foods, strict “commercially sterile” standards apply, requiring products to remain free from germs that could grow during storage.
Round-up of Changes to Laws Relating to Excise, Agriculture, Private Health Care Services and Tax Dispute Resolution Framework
In the first quarter of the year, several laws were amended to ensure they remain current and aligned with the country’s evolving legal landscape.
Excise Law (Law No. 13/2026)
On 7 March 2026, the National Defence and Security Council (“NDSC“) enacted the Excise Law (Law No. 13/2026) (“Excise Law“), introducing a comprehensive new legislative framework governing Myanmar’s alcohol industry. It applies to any liquid containing more than 0.5% ethyl alcohol by volume, including beer, wine, toddy sap, fermented liquor, and distilled spirits such as whisky, brandy, gin, rum, and vodka. Denatured alcohol used for industrial or pharmaceutical purposes is expressly excluded from the law’s scope. The Excise Law establishes a unified licensing regime for all excise business activities. Licence categories include Production, Value-Added Production, Bottling, Distribution, and Sales. Any person wishing to operate an excise business must apply for the relevant licence from the district excise officer. Regardless of the date of issue, all excise licences are valid only until the end of the relevant financial year, and renewal requires a separate application to the township excise officer.
A critical restriction for foreign investors is that licences may only be granted to Myanmar citizens or Myanmar-registered companies with no more than 49% foreign shareholding. Foreign entities holding or planning to acquire stakes in Myanmar alcohol businesses must carefully review their ownership structures to ensure compliance with this cap. The Department may also designate certain excise business categories as subject to a quota, limiting the number of available licences.
The Excise Law establishes a new Excise Policy Committee chaired by the Union Minister of Home Affairs, which must review excise policies at least once every five years. Additionally, regional and state governments, as well as the Nay Pyi Taw Council, are empowered to impose time restrictions on alcohol sales and regulate alcohol consumption within their respective territories.
Fertilizer Law (Law No. 15/2026)
Two targeted but significant changes have been made to the Fertilizer Law. First, all references to “the Ministry of Agriculture and Irrigation” are replaced with “the Ministry of Agriculture, Livestock and Irrigation.” Any correspondence or documentation referencing the former ministry name should be updated accordingly. Second, fines under the existing offence provisions have been substantially increased. All businesses involved in the import, export, production, distribution, and sale of fertilisers in Myanmar, including manufacturers, traders, and distributors, must ensure their compliance programs reflect the new penalty levels.
Priority actions include updating internal compliance documents and contracts to reflect the new ministry name, reviewing current practices under Sections 36 and 37, and treating compliance as immediate as no express transitional period is stated.
Seed Law (Law No. 14/2026)
Mirroring the Fertilizer Law amendment, two parallel changes are introduced to the Seed Law. First, all references to “the Ministry of Agriculture and Irrigation” are replaced with “the Ministry of Agriculture, Livestock and Irrigation.” Second, the fine threshold of MMK 1,000,000 referenced in sections 28 and 29 of the Seed Law is replaced with MMK 3,000,000. Section 28 addresses unregistered plant variety production, unlicensed seed business, or non-compliant seed distribution. All businesses involved in the production, sale, import, and export of seeds in Myanmar, including seed companies, agrochemical distributors carrying seeds, and licensed seed merchants, are affected.
Private Health Care Services Law (Law No. 7/2026)
On 17 February 2026, NDSC enacted the Amendment to the Private Health Care Services Law (Law No. 7/2026). The amendment introduces two new regulated business categories: (i) Private Health Training School Business and (ii) Private Outpatient Surgical Services Business, each subject to specific operational and facility requirements. The amendment also revises licensing procedures by replacing “prior permission” with “prior recommendation,” and clarifies the respective roles of the Central Body and regional Supervisory Committees. Additionally, the amendment introduces enhanced compliance obligations, including a prohibition on false or misleading advertisements and a requirement to operate strictly within the scope of the relevant licence.
Revenue Appellate Tribunal Law (Law No. 9/2026)
On 26 February 2026, NDSC enacted the Law Amending the Revenue Appellate Tribunal Law (Law No. 9/2026), strengthening Myanmar’s tax and customs dispute resolution framework. The definition of “revenue” has been expanded to expressly include all taxes under the Union Taxation Law, as well as tariffs, customs duties, fees, license fees, permit fees, and fines collected for the Union Fund. Tribunal membership eligibility has been broadened: members must now hold at least the rank of Director with a minimum of ten years’ experience in law, taxation, accounting, or auditing, or be designated as professional experts. The amendment clarifies the procedure for referring questions of law to the Supreme Court of the Union. The Full Bench determines whether a referral is warranted, either on its own initiative or upon application by a party. Government representatives holding the rank of Staff Officer or above are now authorised to appear and present arguments before the Tribunal. Additionally, the Tribunal must submit an annual report to the Government within ninety days from the end of each financial year.
Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice
