Financial Crime World

Laos Looks to Boost Revenue through Tax Reforms

The Lao Ministry of Finance has launched a series of reforms aimed at increasing revenue and improving tax collection in the country. The reforms are designed to widen the tax base, increase the number of taxpayers, and streamline tax administrative procedures.

Wider Tax Base

The reforms aim to eliminate or reduce tax exemptions and amend rate structures to review and reconsider tax holidays and exemptions. This will include reviewing and amending tax rates in the present system to make it more transparent and less prone to abuse.

  • Eliminate or reduce tax exemptions
  • Amend rate structures
  • Review and reconsider tax holidays and exemptions
  • Make tax rates more transparent and less prone to abuse

Increased Taxpayers

The government plans to increase the number of taxpayers by bringing additional individuals and businesses into the tax net. This will involve:

  • Detecting and bringing non-filers into compliance
  • Reclassifying businesses from presumptive to accountant holding systems
  • Amending the presumptive tax system to make it more transparent and less prone to abuse

Streamlined Tax Administrative Procedures

The reforms aim to streamline tax administrative procedures, which have been impacted by fiscal decentralization and inefficient audit and control mechanisms. The government plans to:

  • Develop a strategy for ICT development to enhance tax administration operations
  • Detect non-filers and improve voluntary compliance
  • Improve audit and control mechanisms

Expected Outcomes

The reforms are expected to result in:

  • Increased revenue for the government
  • Improved compliance among taxpayers
  • A more stable source of funding for public services
  • Enhanced transparency and accountability in the tax system

Introduction of Value-Added Tax (VAT)

In related news, the Lao government has announced plans to introduce a value-added tax (VAT) in the coming years. The VAT is expected to help increase revenue and provide a more stable source of funding for public services.

Key Reforms:

  • Widen the tax base
  • Increase the number of taxpayers
  • Streamline tax administrative procedures
  • Introduce a value-added tax (VAT)

Expected Outcomes:

  • Increased revenue for the government
  • Improved compliance among taxpayers
  • A more stable source of funding for public services
  • Enhanced transparency and accountability in the tax system