Vehicle importers demand release of new tax rates
Vehicle importers demand release of new tax rates
Vehicle importers have urged the Ministry of Finance to release the new excise tax rates now, before the revised Law on Tax comes into force next month.
“It seems the government wants to enforce the newly revised Law on Tax next month, but so far we haven't received any official notice on the new excise taxes for vehicles,” said one Vientiane car dealer.
“We plan to import new vehicles but we'll have to delay this because we must wait and see what the new taxes are before we can make a plan for imports.”
Laos promulgated the Law on Tax earlier this year and has been publishing the details in the media for the past weeks, indicating that the business community should be ready to pay the new tax rates at the start of the 2012-2013 fiscal year on October 1.
The law does not state excise tax rates for vehicles as previously. Instead it empowers the Finance Ministry to set taxes within a 25 to 150 percent range of the sale price depending on the model and engine .
According to officials, vehicles that are considered to be luxury sedans or SUVs and have a larger engine will incur higher taxes. But importers need to know the exact taxes that will be imposed so they can use the information to draw up import plans and set their prices for next fiscal year.
The Ministry of Finance's Tax Department Deputy Director General, Mr Khamphay Vongsakhampheuy, said yesterday the department had sent a draft of the prime ministerial decree on the Law on Tax, giving the exact excise tax rates for vehicles.
“I don't know when the higher authorities will approve the draft so I don't know whether the law will be enforced in October,” he said, adding that senior officials may disagree with the draft and change the proposed rates. In these circumstances he did not want to release the unofficial rates.
He went on to say that what he could disclose was that the revised Law on Tax would cause a change in vehicle prices.
“Prices could be lower or higher once the law is enforced,” he said.
According to officials, the government may use the tax rates as a measure to reduce the number of vehicles on city streets. Vehicle numbers, especially in the larger towns, have seen a big increase over the past five years due to economic growth.
The government has already banned the import of second hand vehicles to make fewer vehicles available, ease congestion, and prevent pollution
vientiane times
