Deputy Prime Minister and Minister of Finance, Somdy Duangdy presented a draft amended law relating to tax management at the National Assembly’s ongoing session yesterday before the debate of NA members.
Mr Somdy stressed that the existing law had been revised five times with the latest amendment made in 2015. Nevertheless, it was critical to amend this law to address loopholes and procedures which could occur during enforcement processes.
“The existing law does not cover the government’s intentions towards modernisation of the revenue collection system. It still does not define the tax payment processes and how to monitor the payment of taxes,” he said.
“To include several taxes in the one law, it’s quite difficult for enforcement processes and the revision of tax rates, so we need to make this law more comprehensive.”
The tax management law is being debated amidst Laos encountering economic difficulties, notably the country’s revenue shortfall and rising debts. If the law is comprehensive and enforced correctly, it will facilitate the growth of the business sector and generate more revenue for the nation.
Meanwhile, NA members concentrated their debate on modernising the financial sector, tax break policy, the ethics of tax officials, and financial leaks.
NA member for Saravan province, Mr Bounpone Sisoulath said the draft amended law did not include tax collected based on the contract between authorities and businesses. The contracted tax was considered a huge source of revenue, which should be stipulated in the law.
NA members called for relevant sectors to provide better services to the business sector and ensure all proposals relating to business operations are approved as planned. Any delays in documentation processes could increase the cost of doing businesses in Laos.
According to the government’s report, national revenue collected from January to April amounted to 6,320 billion kip, equal to 24 percent of the figure targeted for the whole of 2019. This means the government needs to work hard to boost national income in response to the needs of budget expenditure.
NA members called for the government to define sources of revenue accurately and sufficiently amass them.
The NA believed the tax management law would serve as an essential legal instrument for authorities to collect sufficient revenue and contribute to business activity and boost domestic productivity.
The amendment of this law is in line with the government’s policy on financial reform and addressing barriers hindering the development of the financial sector.
A representative from the Ministry of Finance will present the newly-drafted law on excise duties today and newly-draft law on income tax tomorrow. In future, the finance ministry will enact laws relating to land tax and environmental tax.