2020 04 February

Lao PDR Tax Update: New Tax Rates Effective from 17 February 2020

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In June 2019 the National Assembly adopted the three new tax laws: the Law on Tax Administration, the Law on Income Tax, and the Law on Excise Tax. The laws have been promulgated by the President of Lao PDR and were posted on the Official Gazette on 3 February 2020 and will come into effect on 17 February 2020.
 
The new income tax rates that will apply to employees from 17 February 2020 are as follows:

Taxable salary at each level Basis of  calculation Tax rates Tax at each level Total tax payable
LAK 1,300,000 and below 1,300,000 0% 0 0
LAK 1,300,000 – 5,000,000 3,700,000 5% 185,000 185,000
LAK 5,000,000 – 15,000,000 10,000,000 10% 1,000,000 1,185,000
LAK 15,000,000 – 25,000,000 10,000,000 15% 1,500,000 2,685,000
LAK 25,000,000 – 65,000,000 40,000,000 20% 8,000,000 10,685,000
LAK 65,000,000 and above 25%

Other Income of individuals

  • Income tax on income from sale-purchase, transfer of agriculture land is 1%
  • Income tax on income from online sale is 2%
  • Income tax on income from consulting fees of independent consultants is 5%
  • Income tax on income from the leases, such as land, houses constructed items, vehicles, machinery or other assets is 10%

Companies will now be subject to profit tax at a rate of 20%, lowered from the previous 24%.
 
We will be discussing all the latest changes at our tax seminar on 19 February 2020. For further details or if you have any questions, please feel free to contact us.

The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.


Key Contacts

Jack Sheehan
Partner & Head of Regional Tax Practice           
jack.sheehan@dfdl.com

Senesakoune Sihanouvong
Partner
senesakoune.sihanouvong@dfdl.com

 

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