VAT Collection To Start Next Month

Source: Vientiane Times

The Customs Department of the Ministry of Finance will begin collecting Valued Added Tax (VAT) payments next month with the department readying equipment and human resources.

“At the beginning we will be collecting VAT at the first Thai-Lao Friendship Bridge between Nong Khai province and Vientiane followed by the other international border crossings,” Acting Director General of the Customs Department, Mr Bounpaseuth Sikounlabout told local media during a press conference on Friday.

Mr Bounpaseuth Sikounlabout.

Ministry of Finance had issued a Provision on the Levy of 10 percent Value Added Tax of Passengers’ Personal Effects No.2834/MoF, dated 30 August 2016.

In order to extend the implementation of the provision, the Customs Department has also issued an Instruction on the Management of the Levy of 10 percent Value Added Tax of Passengers’ Effects No.09523/CD, dated 16 September 2016, which stipulates rules, procedures and measures on the implementation of the provision.

The provision stipulates that Lao citizens or expat passengers living in Laos upon entry through border checkpoints including international airports shall pay 10 percent value VAT on their (new or used) personal effects. The levy of VAT is exempted for infrequent passengers who travel less than twice a month on items costing less than US$50.

Frequent passengers to Laos are not exempted from VAT and will be charged accordingly.

Passengers entering Laos shall fill in a Customs Declaration Form for Personal Effects and submit it to customs officials upon their entry into the country. In cases where the personal effects are new, the passenger shall attach a purchase receipt to ease and hasten the calculation of VAT.

In case s where passengers do not have all receipts or eligible documents, or have no documents, the customs officials will have the right to evaluate items according to present circumstances to calculate VAT.

The department is currently improving facilities to ensure transparency and swift service, especially IT and software systems plus setting up more lanes.

“In cooperation with BCEL we are developing a system for the tax payments so that people can declare the value of their goods and pay the tax using their smartphone,” Mr Bounpaseuth said.

While the government isn’t expecting large sums from the VAT collections it will help to improve revenue collection in the country and assist Laos adjust to international integration.