In the 2019-2020 fiscal year, 20 companies with expired business licenses won government contracts with the Ministry of Development Affairs and Construction.
According to U Aung Kyaw Thu, the Hluttaw representative of the Mon State Parliament, this means that companies with valid business licenses, and who are paying taxes are being disadvantaged.
The information came to light after the Mon State Parliament Audit and of Public Budget Scrutiny, Finance Planning, and Economics Matters Review Committee, requested the Directorate of Investment and Company Administration submit information about the companies that won the government tenders. It was then discovered that 20 companies held an invalid business license.
“Since [these businesses did not re-register], the company is considered to be abolished. It is really easy for a company to re-register [their business license] once a year through an online process. [Because these] companies have won a tender without [renewing their business license, other] companies that are paying taxes to the government have now suffered,” said U Aung Kyaw Thaw.
Unregistered companies winning government tenders, has raised questions. The tendering process will now be questioned to check whether or not it was in line with the Directive of the President’s Office No. 1/2017.
U Min Kyaw Lwin, Minister for the Ministry of Development Affairs and Construction believes the Mon State government does not recognize companies that are not registered.
However, it seems that in some cases, companies that won tenders completed some of the work. U Min Kyaw Lwin stated, “… the tender will not be granted according to the 1/2017 [the Directive of the President’s Office]. The tender will be given when it is approved by the Directorate of Investment and Company Administration. But now, when it’s 70%-75% done, …actions will [need to] be taken according to the law.”
In the 2019-2020 fiscal year, the Mon State government approved funding for over 130 billion Kyats. The Ministry of Development Affairs and Construction’s operating budget is now just over 50%, or roughly 70 billion Kyats.
