Lao People's Democratic Republic - Taxation
In 1977, the government introduced a progressive agricultural tax on production. The tax revenues were to be used to develop forestry and mining without the need for outside aid, but the tax had the unwanted side effect of discouraging production by some of the largest landowners and slowing the achievement of self-sufficiency in food. The 1992–93 budget included a new profits tax and a law requiring foreign firms engaged in construction projects to pay taxes. The agricultural tax was replaced by a land tax, and consumption taxes were raised on fuel oil, liquor, beer, and tobacco. The 1989 economic reforms included a new flat tax rate of 20% on profits for foreign-owned companies. The top personal income tax rate is 40% with the marginal rate for the average tax payer 10%. The top corporate tax rate is 35%.