Proposed raise of VAT from 7% to 10% early 2024
The southeast Asia state of Laos is proposing increase its standard VAT rate from 7% to 10% in early 2024. This would reverse the cut of January 2022 (see below).
The Ministry of Finance believes that the 2022 cut has not achieved the predicted boost to the economy post-COVID pandemic. The country’s currency has been falling on concerns about the deficit, and so the Ministry is seeking to boost government revenues next year.
1 Jan 2022 Tax cut to boost foreign investment
Laos Value Added Tax rate from 10% to 7% from 1 January 2022. The aim is to attract regional investment to help boost the economy as it emerges from the COVID-19 pandemic.
VAT deductibility will now be conditional on payments made from a Laos-resident bank account
The Law on Tax was also amended to exempt a number of supplies from VAT:
- import and export of electricity
- Export of minerals
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