Audit And Compliance In Laos: A Guide For Foreign Investors
The Enterprise law and the Law on Independent Audit are the main laws that establish audit requirements in Laos.
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Tax
Projected Revenue Shortfall Adds To Nation’s Debt Burden
Laos is undergoing an unprecedented level of macroeconomic stress and the pandemic has worsened an already fragile economic landscape.
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Business Operators Urge Cut In Transportation Costs
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.
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Laos To Lose Favourable Trading Status After LDC Graduation
Laos could face a trade loss of US$102 million under the special tariff scheme if the country graduates from the UN’s Least Developed Country (LDC) status in 2024
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Cabinet Instructs Business-Friendly Policy Improvements, Tightening Of Border Crossings
Chaired by Prime Minister Thongloun Sisoulith, the two-day meeting told officials in charge to improve policies to promote small and medium enterprises (SMEs).
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Fiscal Deficit Ramps Up Pressures On Lao Government
An elevated fiscal deficit will result in growing public debt, which will ramp up pressure on the country’s debt servicing capacity amid the Covid-19 crisis.
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Laos’ Tax Collections Decrease Due To Covid-19 Pandemic And New Tax Law Adjustment
Laos will not be able to achieve the target for tax collections this year due to the Covid-19 crisis and the implementation of the adjusted new tax law.
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Lao PM Announces Tax Break
Lao Prime Minister Thongloun Sisoulith just announced the following tax measures to reduce the impact from COVID19 on SME’s
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Tax Update: Postponement Of The Filing Due Date of Financial Statements for 2019
The filing due date of the financial statements for 2019 is postponed to 30 April 2020
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Finance Ministry Warns Motorists To Pay 2020 Road Tax
The Ministry of Finance issued a notice last week reminding vehicle owners to pay the road tax by the end of this month, or face a fine.
Read more Road Tax 2020 Reminder
Vehicle owners are urged to pay the 2020 Road Tax or face a penalty. The Ministry of Finance issued a
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Pay Road Tax Or Get Stopped At The Border
Vehicle owners who have not paid road tax will not be permitted to cross the border into other countries
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Lao Vehicle Imports, Exports To Be Processed Using Single Customs Window
All vehicle imports and exports will have to be recorded under the Lao National Single Window (LNSW) system at the Lao-Thai Friendship Bridge checkpoint starting on March 1.
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Laos Implements New Income Tax Rates
The new law provides better progressive rates for personal income tax and has lowered profit tax rates.
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Laos Imposes New Regulations On Growing Vehicle Industry
The government has promulgated a new prime ministerial decree, which aims to more effectively administer the growing number of businesses involved in the import, sale and assembly of vehicles in Laos.
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Lao Customs Department Extend Use Of Modern Clearance System
The Customs Department will extend the use of an automated customs management system to other main customs checkpoints
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Lao Government Considers Tax To Protect Environment
Industries that produce pollution may have to pay more taxes now that the Lao government has embraced the National Green Growth Strategy.
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Pay Road Tax 2019 Or Face A Big Fine
Large fines meted out by authorities on slow paying vehicle owners are forcing more to pay their road tax on time and helping to fill the government’s coffers
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Laos Eliminates Tariffs On Most Asean Goods
LAO authorities have reduced import tariffs on 8,536 items to zero as part of national efforts in establishing the Asean Free Trade Area, according to a government report.
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New Amended Law On VAT
The key important points to note from the Amended Law on VAT are summarized in this alert.
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App-facilitated Land Tax Payment Service Launched
The Department of Tax has launched a system that ensures land tax payment is bank-based, safe, and fast.
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SMES To Be Subject To VAT
Small and Medium Sized Enterprises (SMEs) in Laos must prepare for a new challenge when the government enforces the Law on Value Added Tax (VAT) next year.
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Online System Boosts Road Tax Revenue
The revenue earned from taxes has increased massively since the government introduced an online payment system.
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Provincial SME’s Need Regulatory Burden Relief, Swifter Tax Registration
Authorities need to reduce the regulatory burden or “red tape” that businesses face in conducting their activities due to rules and regulations so that their compliance costs can be cut to increase their efficiency.
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Lao Tax: Everyone Who Travels Pays
Sources at the friendship bridge said there were no exceptions and the tax applied to all foreigners regardless of their travel documents, include foreigners who are resident in Laos.
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Laos Slaps A Dollar Tax On Tourists
Almost forgotten but on the brew for years the much talked about tourist tax was quietly introduced at all of Lao PDR’s border checkpoints 1 October.
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PM Orders Top Officials To Ramp Up Economic Growth
Prime Minister Thongloun Sisoulith has ordered ministers, the Vientiane mayor and provincial governors to implement eight measures to stimulate economic growth.
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Laos Announces Adoption Of New Asean Tariff Code
The Ministry of Finance in Laos has announced it has adopted a new Asean tariff code, giving a signal that Laos is ready to become part of the single regional market of 600 million consumers.
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Excise Tax On Internet Use A Barrier, Business Insists
Members of the Lao business sector have recently called for the government to abolish a 10 percent excise tax on internet usage, claiming that Laos remains the only country in Asean to impose the charge.
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Lao Fuel Price Double World Market Average
The average fuel price in Laos is more than double than the global price
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New Decree Offers Tax Breaks For Investors in Lao SEZs
Domestic and foreign investors will be granted a number of tax breaks under a new amended decree related to specific and special economic zones (SEZs) issued recently by the government.
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Illegal Vehicle Import Crackdown Ordered As Tax Avoidance Raises Ire
The Ministry of Finance has warned that it will impose stronger legal actions against any owners of imported vehicles evading taxes and tariff payments to the government.
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Amended Law Offers No Exception To VAT Charge
All enterprises that have been registered and have obtained a tax ID will have to comply with the Value Added Tax Law.
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Govt Piloting Single-Window Customs Clearance For Vehicles
The government is piloting the Lao National Single Window (LNSW) scheme at international border crossings, seeking to speed up customs clearance for vehicles and link the country to the Asean single window system.
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Four-Month Revenue Collection Amounts To Only 20 Percent Of 2018 Target
The collection of revenue throughout the nation over the past four months has reached 5,297 billion kip, equal to only 20.81 percent of the figure targeted for the whole of 2018.
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Pay Taxes Or Face Closure, Thousands Of Businesses Warned
Vientiane authorities have warned 3,039 enterprises to pay taxes and declare their business plans, with the threat of closure hanging over them if they fail to comply.
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Lao Firms Identify High Tax Rates As Investment Constraint
Lao enterprises have highlighted the perceived unprofessional practices of firms in the informal sector and high tax rates as the top constraints in investing in the country, according to a report from the World Bank.
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Authorities Call For Vehicle Owners To Pay Road Tax 2018
Authorities have announced that 2018 road tax can now be paid and the Ministry of Finance is calling on vehicle owners to pay their obligations to the nation.
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Govt Hikes Excise Tax On Fuels, Alcohol, Tobacco & Entertainment Services
The government has imposed more taxes on fuel and other goods and services as authorities increase efforts to collect additional revenue to meet set targets.
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Govt Resolves Illegal Import Of Thousands Of Vehicles
The government last year documented and processed the paperwork for 11,030 vehicles and motorbikes that had been imported unlawfully, according to an official report.
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Govt Committed To Recovering Unpaid Taxes
The government will strive to collect taxes owed by businesses after they failed to pay them during the first six months of this year, according to a government report.
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Govt Vows To Retrieve Billions Lost To Misuse, Illegal Imports
The government has entrusted authorities in charge to carry out inspections into 45.53 million litres of oil that was imported for a state investment project but was never actually used for that project.
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Road Tax 2017 Now Due
Road users are now being asked to pay the road tax for 2017 after delays in making changes to the payment system have extended almost to the end of the year.
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Trillion Kip Spent Unlawfully: State Top Auditor
More than one trillion kip of state spending without approval from the National Assembly (NA) has been uncovered, the state top auditor told the parliament this week.
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Finance Ministry Unveils 10 Measures To Boost Revenue For 2017
The Ministry of Finance has announced it will implement 10 significant measures for the rest of the year to achieve the projected target of collecting revenue worth 23.48 trillion kip.
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Road Tax 2018 …. updated
The President of Laos, Mr Bounnhang Vorlachit, in an official announcement has informed today about the Road Tax fees for 2018.
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New State Projects Threaten Budget Blowout
New project proposals for 2018 submitted by State sectors and provincial authorities threaten to incur costs higher than the government’s financial capacity, a senior official has noted.
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Cuts Made In Public Contributions To Road Fund
Vientiane authorities have offered to significantly reduce the public’s contribution to the Vientiane People’s Road Fund following widespread complaints about the costs involved.
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Numerous Revenue Leak Loopholes Remain, Govt Told
A number of loopholes remain that are resulting in leaks undermining revenue collection, members of the National Assembly (NA) told the government yesterday.
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Ceiling For Social Security Contributions Raised
In line with the policy to adjust the maximum ceiling of the insurable earnings under the National Social Security Fund (“NSSF”) framework at five times the minimum wage set by the Government of Lao PDR and adjusted from
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Government Introduces Customs, Tax, Fee E-Payments
The Lao government is upgrading payment methods for customs, tax, and other fees at the international customs checkpoint nationwide.
The Ministry of Finance together with …
Illegal Vehicle Importation Chased Up
Vientiane authorities have resolved a significant number of cases of illegal car imports and import tax avoidance over the past six months, recovering funds due to support the nation’s budget.
The 382 vehicles seized in the capital were …
The Lao-Singapore Tax Treaty/DTA is Now Effective
In case you missed it, Singapore’s reputation as an attractive holding company location for investments into Lao PDR recently went up a notch: after being signed way back in February 2014, the long-awaited tax treaty/double taxation agreement between Lao PDR and Singapore (the “DTA”) became effective on 1 January 2017.
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Benefits From Integration Elude Laos
Although the Asean Economic Community has resulted in increased economic activity between Laos and other countries in the regional bloc, the nation still must overcome numerous challenges to benefit from regional economic integration.
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Thai Government To Air Concerns On Lao VAT
The government is set to raise the issue of Laos’s value-added tax (VAT) in a joint discussion with Lao counterparts, fearing the new tax measure may cripple growing border trade.
Thailand will ask for leniency and a spending ceiling from Laos during the meeting, which is expected to be held soon.
Laos has begun collecting VAT on products imported from abroad, starting at the …..
VAT To Be Levied At Border Crossings, Effective Immediately
All people who enter Laos bringing with them goods items valued at over US$50 will have to pay 10 percent of the goods value to the government as Value-Added-Tax(VAT), with the decision already in force.
Through this decision, the minister has tasked the customs sector to implement the levy on all Lao and foreign passengers entering the country via border crossing points and international airports, while all citizens are ….
Tax Rates Set To Increase Next Year: Ministry
The Taxation Department of the Ministry of Finance is aiming to introduce new land and road tax rates to boost government revenue for next fiscal year.
According to the Taxation Department’s report for the first seven months of the 2015-2016 fiscal year they were yet to determine what the percentage increase would be for the numerous categories of land and road tax.
At present tax is collected for land and vehicles at many different rates depending …..
Import Tariff Reductions Have Little Impact On Vehicle Prices
The prices of vehicles in Laos remain high even though import tariffs on many products including vehicles have been reduced to five percent, much to the disappointment of recent purchasers.
Deputy Director of the Foreign Trade Policy Department, Mr Saysana Sayakone told Vientiane Times recently that the prices of vehicles will remain rather high as buyers still have to pay consumer tax.
He explained that the Lao PDR had begun to reduce …..
Tax Alert: Revised Tax Law Pending
The Lao Government ‘slipped through’ a revised tax law recently (Amended Tax Law No. 70/NA, dated 15 December 2015), with the law set to take effect next week on 24 May 2016. But fear not: much of the revised law is similar to the law it replaces, the Tax Law (2011), with a few new inclusions, revisions and corrections.
That said, one glaring adjustment is the insertion of a new article on profit tax withholding for foreign entities deriving income from ….
Tax Payments Decline Over Seven Months
The Taxation Department reported recently that tax payments across the country had decreased 5.1 percent during the first seven months of the 2015-16 fiscal year, in comparison to the previous year.
Tax collection in the first seven months of 2015-16 reached 4,678.67 billion kip or 46. 4 percent of the target.
Meanwhile at the provincial level, tax authorities were able to collect …..
New VAT Invoices Distributed To Boost Revenue Collection
Many people in Vientiane have begun to request the newly made Value Added Tax (VAT) invoices after learning the receipts may contain prizes, with tax officials hoping that the new incentives will boost revenue collection.
“I’d like a VAT invoice because I may win a prize,” said a customer at a small barber shop in Phontong village, Chanthabouly district, Vientiane last weekend. “If this invoice really contains prizes, it is better than……
Laos Prepares For Tax Payments Via The Banking System
The Ministry of Finance expects to have widened the availability of modern tax payment systems via private banks in Laos, seeking to make it easier for business operators to meet their tax obligations.
The project shall help prepare towards the AEC while the tax and duty collection sector requires modern services systems to improve accountability and make it easier for …..
Govt Faces Challenges Collecting Revenue As Planned
The Ministry of Finance still has a difficult task in collecting revenue as per the plan approved by the National Assembly for fiscal year 2014-15, a senior government has noted.
“In the past six months of the fiscal year, we’ve been able to collect 13,000 billion kip. This means that we have to collect 17,000 billion kip in the last six months of the year in response to ……
Long Queues To Pay Road Tax
People in Vientiane are facing a long queue when they go to pay road tax this year as they need to register the vehicle’s information.
The new service for paying road tax began in the middle of last month in each District Finance Office in the city plus a road tax centre in Naxay village of Xaysetha district.
“Many people are complaining about the long queues as last year there was much less …..
Road Tax 2015: New Procedures
The Ministry of Finance is informing all vehicle owners that the Road Tax Sticker for 2015 is now available and that it needs to be purchased for all vehicles. The sticker is valid for the calendar year 2015. Further a penalty of 10% per month for purchasing the sticker after 31st May is imposed.
In addition J&C Services has been informed that the procedures to purchase the Road Tax Sticker 2015 have changed as following: …..
Govt Plates Must Be Removed From Private Vehicles
The government has instructed officials to remove state-owned number plates from private vehicles which previously belonged to the state and car owners must pay customs, tax and other fees.
Those vehicles provided to administrative-level officials of state departments, state funds, and state enterprises are required to have their ownership rights changed after the officials retire, or the vehicles must be returned to the ……
Govt May Revoke 34 Business Licences
The Ministry of Finance (MOF) may cancel 34 business licences this month after the companies failed to declare tax payments to the ministry after they were warned in June last year.
“Earlier this month, we submitted a report to the minister about the need to revoke these 34 licences,” said Mr Khamhack Vivanxay of the ministry’s Revenue Collection Management Division, under the Tax Department.
“They are mostly mining and construction companies, both local and foreign owned. If they do not declare their tax payment, they should come and ……
Road Tax Is Back Again !
Despite previous announcements by the Ministry of Finance that the collection of the road tax has been abolished, J&C Services has just been informed by the authorities that the road tax is back in force again.
The Ministry of Finance informs all vehicle owners that the Road Tax Sticker for 2014 is now available as from 1st May 2014 and that it needs to be purchased for all vehicles. The sticker is valid for …
First Quarter Revenue Collection Falls Short Of Target
The Ministry of Finance has fallen well short of the revenue collection target over the first quarter of this fiscal year, posing bigger challenges for the government to secure funding for its expenditure and investment plan.
From October to December 2013, the finance ministry was able to achieve only 12.29 percent of the annual revenue collection plan, very much lower what it earlier expected.
Normally, the finance ministry is supposed to achieve 25 percent of the revenue collection target over the first quarter of the year, which if achieved would have set a …
Road Tax Sticker No Longer Required
Car and motorbike owners are no longer required to purchase the annual road tax sticker. J&C Services received this information today from the authorities at the technical inspection outlet.
As it’s only a few days this new rule has been introduced, it’s likely that not all police officials are aware of this. J&C Services therefore recommends that ….
Govt To Revise Value-Added Tax
The government will amend the Law on Value-Added Tax (VAT) to remove tariffs on materials Laos cannot produce domestically as part of preparations for the Asean Free Trade Area and Asean Economic Community in 2015.
Under amendments flagged in a government report last week, the 10 percent tariff on some materials and machinery that cannot be produced in Laos will be reduced to zero in a bid to promote productivity in other sectors.
The government has moved to assure the amendment will not impact …..
Poor Management Deprives Lao Govt Of Taxes
A large amount of revenue from taxes and tariffs has been lost due to poor management of the financial system and a lack of cooperation from business operators.
In addition, the government is deprived of revenue due to its tax exemption policy for foreign investors, Minister of Finance Mr Phouphet Khamphounvong said.
Revenue is also lost because some businesses import goods illegally, while customs officers do not manage their work properly. In addition, many traders try to avoid paying tax and do not meet their …..
Major Tax Revamp Trials Next Month
The government is planning to start using an electronic system for tax collection early next year with a test of the system on motor vehicles to begin next month.
Revenue collection has not reached the planned target because of various violations of the regulations and loopholes in procedures, which has resulted in a further deficit and hike of the government debt.
The new method of taxation will calculate tax based on a vehicle’s engine capacity (both the size and number of cylinders), its brand and model, but not its ……
Inflation Causing Precarious Economy
A far higher than expected inflation rate means Laos must take precautions or be at risk of a financial crisis, according to the Deputy Minister of Planning and Investment.
“The current situation is between yellow and red light mode as the inflation rate has reached 6.84 percent,” he said. The government aims to keep the kip fluctuating between -5 and +5 percent in value against the US dollar and Thai baht.
However the current kip inflation rate is close to…….
Laos To Eliminate Asean Import Tariffs By 2018
Laos has begun to reduce import tariffs in line with Asean Free Trade Area (AFTA) policy but has until 2018 to fulfill all of its obligations.
The new Asean member countries are Cambodia, Myanmar, Laos and Vietnam. These countries need time to build their capacity to fulfil all their obligations under the AFTA. The older Asean member countries – Brunei, Thailand, Singapore, Malaysia, Indonesia and the Philippines – have been reducing import tariffs to zero since 2010, opening up the regional export market.
Investors In Laos Have A Long Road Ahead
Hopes are running high that the WTO membership will encourage greater foreign investment, and that it will help Laos sustain its impressive growth rates of recent years, running between 6% and 8%. It seems that everyone is talking about the new possibilities for Laos, spreading unbridled optimism.
As a matter of fact, investing in Laos is still a risky bet …. here’s why:
First of all, it’s important to understand that whatever happens in the capital city of Vientiane does not reflect on the rest of the country. In fact, over 70% of Laos’ small population of 6.5 million people depend on agriculture for their livelihood. Slashing subsidies on agricultural exports as required …..
Lao Govt To Delay Car Usage Tax
The government will delay the enforcement of an annual car usage tax and a natural resources tax, even though the National Assembly had earlier given the green light to impose the taxes.
The National Assembly approved the revised Tax Law at the end of last year, allowing the government to collect the car usage tax annually instead of as a lump sum after finding that vehicle importers were failing to pay the full amount of excise tax due to the high rates levied.
The tax official also said the government will not impose the approved natural resource tax until it has revised the presidential decree on state service fees. He was unable to say when the revised decree would be promulgated.
High Taxes Affect Business In Laos
Companies operating in Laos have identified high taxes as one of the main obstacles to doing business in the country.
Speaking in response to the World Bank’s latest survey on the Lao business climate, both Laos-based and foreign firms say business tax rates are very high, making it difficult for them to stay competitive.
The bank’s survey also highlights that businesses in Laos consider access to finance to be the second largest problem despite the rapid growth of banks and microfinance institutions in Laos.
Fixed Import Tariffs To Continue Until 2013
The government will continue to set a fixed price as a reference for import tariffs on some commodities until 2013, despite calls from international companies to abolish the trade barriers, the Ministry of Finance announced.
The government will continue to use the fixed price system to levy duties on some imported goods for the remainder of this year and the next. Customs officials will begin to apply levies based on the actual price of most imported goods leading up to 2013, as this is one of the main requirements for Laos to become a member of World Trade Organisation
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Foreigners To Pay More Income Tax
It was Benjamin Franklin who said that nothing is certain in life except death and taxes. He certainly wasn’t wrong, even here in Laos. A new law is set to increase taxes paid by foreigners from the current flat rate of 10% to up to 28%. Tax paying organisations with a large amount of foreign workers are in for a rough ride.
The presidential decree regarding tax which has now been passed was dated 01 March 2011 and amends the existing tax rates of Profit Tax, Business Turnover Tax and Personal Income Tax.