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Business Operators Urge Cut In Transportation Costs

Source: Vientiane Times

The business sector has requested the government find ways to reduce transportation and customs clearance costs to ensure that the collection of fees is done strictly under the Lao President’s Decree.

The public-private consultative meeting in Vientiane on Wednesday informed that expensive transportation costs are a major obstacle to all aspects of doing business in Laos and is as a major factor in attracting foreign investment, as transportation costs have a direct impact on commodity prices and production costs.

Overall, the factors that make Laos’ transportation costs much more expensive than the neighbouring countries are trade imbalances and the high documentation costs.

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Through addressing of the issues at the 10th and 11th Lao Business Forum, the government, especially the Department of Finance has improved the collection of fees and services related to the transportation of goods by collecting them through the Smart Tax system at various custom checkpoints such as the service fees for the declaration of goods at 350,000 kip.

Business owners find this an improvement and that it can also be legitimately verified.

However, there are still many fees associated with transporting goods being traditionally levied in cash which should be addressed as soon as possible.

They include a bridge toll (10-wheeler or more) at 135,000 kip per vehicle, entry-exit fees (18-wheeler a trailer) of 120,000 kip per vehicle and the plant quarantine fee for transit goods (the Lao-Thai Friendship Bridge 3) is 150,000 kip per vehicle.

Besides, there are service and other fees that are collected in cash, which do not comply with the President’s Decree or without a receipt. The cost of these fees at various checkpoints is different.

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The fees that business owners have reportedly come across are entry-exit points include (Form 53) at 20,000 kip per vehicle, drivers’ record stamp is 5,000-20,000 kip per vehicle, unofficial service fee for inspecting documents (ASYCUDA Room) is 20,000-100,000 kip, inspection fees for inspection officers is 20,000-100,000 kip per vehicle, cost of removing immigration barricade is 20,000-50,000 kip per vehicle particularly at the Dansavanh checkpoint and the road maintenance fee is 500,000 kip per vehicle.

Business owners have also paid for overtime (after office hours 4 pm or weekends and public holidays) around 50,000-200,000 kip per vehicle, service fees relating to taxes, levies, etc that varies from checkpoint to checkpoint and expenses on traffic police on different routes.

In the meantime, during the outbreak of Covid-19, the loading and unloading of trucks (moving containers) transiting through the Lao-Thai Friendship Bridge-I had to be unloaded at the Container Yard warehouse following the Public Works and Transport Department’s regulations.

The cost of loading and unloading the trailer is US$60 a container a time, which is relatively high for business owners.

The business owners have proposed to the government to cooperate with the relevant public sector to fully utilise the contemporary system in documents declaration and collection of fees that are associated with the transporting of goods.