Car dealers urged to declare actual vehicle price
Car dealers urged to declare actual vehicle price
The Ministry of Finance has urged car dealers in Laos to declare the actual price of their goods so the authorities can collect tax accurately, according to a senior tax official.
Tax Department Deputy Director General, Mr Lamngeun Tanlamany said yesterday the department had informed car dealers nationwide to declare the actual price of the cars they have purchased from f oreign countries so as it would be able to collect the full amount of tax.
“Car tax rates will remain unchanged but the declared price of the goods will be adjusted,” he said in an interview with Vientiane Times.
At present, the Ministry of Finance allows car dealers to self-declare the price of cars they purchase but many tax officials have noted that a large number of car importers declare the price of the goods lower than the reality, making it impossible for the authorities to collect vehicle tax accurately.
At present, the Finance Ministry sets excise tax rates on vehicles from 25 percent up to 150 percent of their value, depending on their type and engine .
A number of car dealers have admitted the government has informed them about changes to the declared car price adjustment, saying the move would cause Laos car prices to rise.
“We will have to adjust car prices, if we have to pay more taxes. We will need to increase the price of the vehicles so we can maintain a business profit,” said one of the car dealers on T2 Road, one of the main centres for car sales in Laos.
Tax officials said car prices in Laos would not change much despite the government forcing car dealers to declare the actual price of their goods, adding that big car dealers already declare the real price of their goods.
They added, prices at large car dealers would alter little and therefore it would not cause major price increases in cars sold by small companies in a competitive market.
The officials also noted that demand for vehicles in Laos has begun to drop after peaking over the past few years, adding that low demand will make prices of cars stable despite the declared price adjustment.
A number of big car dealers such as Chevrolet, Hyundai and Kia have offered promotions such as zero percent interest rates for people who want loans to purchase cars with three years to repay the loan.
The slow down in the economy will also cause lower purchasing power. A number of the mega public infrastructure construction projects have been suspended as the government is facing a shortage of revenue. The Lao economy is projected to see only 7.8 percent growth this year, dropping from the 8 percent earlier forecast.
vientiane times
