Sept 7, 2009 (DVB), A tax on food has been introduced in central Burma, increasing food prices by 10 percent for people already complaining of difficulties affording basic foodstuffs.

Authorities in Bago division's Tharawaddy and Thone Se townships introduced the new tax on 4 September, which will affect all food purchases, from local teashops to roadside vendors.

A local restaurant owner said authorities last Friday handed them receipt forms to use when collecting tax from their customers.

"They gave us these receipts to use when checking the bill with the customers and said a similar system is also being used in Rangoon," said the restaurant owner.

"But Rangoon is a rich city and here people are already struggling to buy food even when the shops are offering discounts."

"How can they pay additional 10 percent on top of their expenses for food?" he added.

A Bago resident said the business owners have been told to collect the tax and hand it to the government's taxation department every 10 days.

According to an order notification by the authorities, those who fail to cooperate would be punished with a maximum three-year prison sentence, a 10,000 kyat ($US10) fine, or both.

The average Burmese wage is around $US200 per year, according to official US state department figures.

Burma's rice supply, its key export, was severely hit by last year's cyclone Nargis, which is thought to have destroyed more than a million hectares of paddy fields.

Following the cyclone, the ruling junta was widely condemned for continuing to export rice at the same levels as before, despite widespread shortages in the country.

Reporting by Aye Nai